The European Union’s determination to enforce a level playing field in the digital market has taken a crucial step forward with the launch of an investigation into Apple’s App Store changes for potential non-compliance with the Digital Markets Act (DMA). If found in breach, the tech giant could face fines of up to 10% of its global turnover, a figure that could equate to billions of euros given the company’s sizeable revenue.
The DMA, designed to prevent gatekeepers like Apple from using their dominant position to stifle competition, requires changes to business practices that the Commission suspects Apple—and other tech giants—have not fully embraced. Despite Apple’s announcement allowing third-party app stores and sideloading of apps on its devices, the Commission’s inquiries suggest these adaptations may not fulfill the DMA’s requirements.
In an official statement, the EU’s antitrust chief, Margrethe Vestager, underscored that “We suspect that the suggested solutions put forward by the three companies do not fully comply with the DMA.” This sentiment was echoed by EU Commissioner for Internal Market Thierry Breton, who stressed the need for fair and open digital space, warning of “heavy fines” for lack of full compliance with the DMA.
Apple’s previous strategy, which included charging a Core Technology Fee for any app sold outside of its own App Store, raised eyebrows and was seen by many as a deterrent for smaller developers. Moreover, the EU is investigating Apple’s approach to the DMA requirement of allowing users to easily uninstall any software applications on iOS and change default settings.
Google is also under the Commission’s microscope for its own responses to the DMA, specifically regarding anti-steering rules and self-preferencing of its services. These investigations are part of a broader EU effort to ensure that its landmark antitrust regulations are respected, as highlighted in the Commission’s remarks.
The EU’s antitrust chief previously signaled concerns about Apple’s compliance, suggesting the measures may “de facto not make it in any way attractive to use the benefits of the DMA.” With the probe aiming to conclude in less than a year, an uncommonly brisk pace for such matters, the stakes are high for the company.
In the face of these investigations, Apple and its peers have defended their efforts to align with the DMA. “We’re confident our plan complies with the DMA, and we’ll continue to constructively engage with the European Commission as they conduct their investigations,” stated Apple spokesperson Julien Trosdorf.
Relevant articles:
– EU rejects Apple’s European App Store changes: Company could be fined 10% of global turnover
– Apple, Meta, and Google targeted by EU in DMA non-compliance investigations, The Verge, Mon, 25 Mar 2024 10:22:29 GMT
– EU is skeptical that Apple’s App Store rules comply with DMA, Cult of Mac, Mon, 25 Mar 2024 19:14:31 GMT
– EU investigates Apple, Google, Meta in first-ever probe under DMA competition law, TNW, Mon, 25 Mar 2024 13:55:00 GMT