The European Commission, the EU’s antitrust and technology regulator, announced Monday that Apple (AAPL.O) had broken the bloc’s technology regulations. This claim might result in a substantial fine for the internet behemoth, which is currently under investigation for newly enforced app developer fees. The Commission has until March of next year to issue a final verdict.
In a statement, EU antitrust commissioner Margrethe Vestager voiced concern about Apple’s new guidelines, arguing they breach the Digital Markets Act. She emphasized that Apple must decide how to comply with the DMA criteria rather than receiving direct instructions from the Commission. Vestager said: “As they stand, we think that these new terms do not allow app developers to communicate freely with their end users, and to conclude contracts with them.”
Apple has stated that it has made several changes in recent months to comply with the DMA in response to feedback from app developers and the Commission. Despite these adjustments, the Commission remains critical of Apple’s business practices, especially on the fees charged for assisting with initial customer acquisition through the App Store. According to the Commission, these costs exceed what is required for such services.
The case against Apple is the Commission’s first enforcement action under the Digital Markets Act, which seeks to curb Big Tech’s dominance while promoting fair competition for smaller businesses. If found in violation of the DMA, Apple might be fined up to 10% of its annual global revenue.
Following an investigation that began in March, the Commission has given Apple with preliminary results. According to the study, Apple only permits app developers to guide customers via ‘link-outs’ in most circumstances. This means that developers can include a link in their app that directs users to a web page where they can complete a transaction, a practice that the Commission considers restrictive.
In summary, the European Union’s antitrust authorities have charged Apple with violating the bloc’s technology regulations, which could result in significant financial fines and spark additional scrutiny into Apple’s new app developer pricing arrangements.