Apple has broken EU laws designed to rein in the power of big tech, the European Competition Commission announced Monday. The tech titan’s App Store rules prevent app developers from steering users towards alternative channels, such as their websites, where they might be able to offer customers better deals and offers, the regulator said.
The Competition Commission also opened an additional investigation to decide whether the “core technology fee,” which Apple charges developers, is compliant with EU rules.
The regulator’s investigations are designed to ensure that people in Europe get the best deal and that they aren’t in any way disadvantaged by the business maneuverings of large companies. In this case, it’s established that Apple’s policies have the potential to cost people more money than they would otherwise spend, due to blocking app developers from sharing those details from within the app. But the EU decision should mean people don’t face inflated costs in the future.
“Apple’s new slogan should be ‘act different,'” said Thierry Breton, Europe’s commissioner for the internal market, referring to the famous Apple motto, “think different.” He added: “We have reason to believe that the App Store rules not allowing app developers to communicate freely with their own users is in breach of the DMA.”
This is not the first time this year that Apple has been the target of the EU’s competition commission. In March, the regulator issued the company a $1.95 billion fine for blocking music streaming services from telling customers about cheaper options.
Until this year, Apple has largely managed to avoid the scrutiny of Europe’s Competition Commission, which has issued many huge fines to its Silicon Valley neighbors, including Meta and Google. The reason that’s all changed is due to a piece of legislation called the Digital Markets Act, which has specific rules that apply to tech’s “gatekeepers” — six companies with an outsized presence in the tech world that have the power to make or break others.
Apple now has 12 months to change its own rules so that they comply with Europe’s, after which the EU could potentially fine the company up to 10% of its annual global revenue. The Commission has said it hopes to resolve the issue without issuing Apple another fine. Instead it’s giving the company time to comply with its suggestions.
Apple announced its plan to comply with the DMA in January and based on feedback from the European Commission and app developers, it has made a number of changes over the past few months.
“We are confident our plan complies with the law, and estimate more than 99% of developers would pay the same or less in fees to Apple under the new business terms we created,” said a company spokesperson in a statement. “All developers doing business in the EU on the App Store have the opportunity to utilize the capabilities that we have introduced, including the ability to direct app users to the web to complete purchases at a very competitive rate.”
The company will continue to listen to and engage with the Commission, they added.
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