On Monday, the European Union’s antitrust regulator accused Apple of violating the EU’s new Digital Markets Act. This accusation could potentially lead to Apple facing substantial fines.
In March, the EU initiated an investigation into Apple. In a press release issued on Monday, the European Commission stated that the preliminary findings of the investigation had been sent to Apple. It was found that Apple’s App Store rules violated the Digital Markets Act (DMA) as they hindered app developers from freely directing consumers to alternative channels to obtain discounts.
This is the first charge brought by the Commission under the landmark Digital Markets Act. The regulation aims to curb anti-competitive behaviors by large tech companies and ensure a level playing field for smaller competitors.
According to the European Commission, Apple’s App Store rules prohibit developers from freely directing their customers. For example, developers are not allowed to provide pricing information within their apps, nor can they communicate with customers in any other way to promote discounts offered by other distribution channels.
Apple now has the right to assess these preliminary findings and respond after receiving them. If the Commission’s initial opinion of Apple violating the Digital Markets Act stands, the Commission must make a non-compliance decision by March 25, 2025.
Companies found to be in violation of the Digital Markets Act could face fines of up to 10% of their global turnover, with fines reaching a maximum of 20% if violations persist, according to the European Commission.
Margrethe Vestager, the EU’s competition chief, stated at a press conference that the focus of the Digital Markets Act is to ensure an open and competitive market. She highlighted the issues in Apple’s new terms, stating that they do not meet the requirements of the Digital Markets Act. If Apple can address these issues by modifying its business terms, they could avoid fines.
Vestager emphasized that compliance with the Digital Markets Act is Apple’s decision, and it is up to the company to determine how to comply, not her.
According to Reuters, Apple stated that it has made some changes over the past few months in response to feedback from app developers and the European Commission to comply with the Digital Markets Act.
“As we always do, we will continue to listen to the European Commission’s feedback and engage with the Commission,” Apple said in an email.
The European Commission also launched a new investigation into Apple’s App Store business model in Europe on Monday, including the introduction of so-called core technology fees. Some app developers have expressed concerns that this may prevent them from benefiting from the new opportunities offered by the Digital Markets Act.