Apple in Hot Water with EU Regulators Over Antitrust Concerns
EU Probe Accuses Apple of Violating Regulations
European Union antitrust regulators have accused Apple of violating the bloc’s technology regulations. This allegation could result in a substantial fine for the iPhone manufacturer, which is also under investigation for new fees imposed on app developers.
The Investigation
The European Commission, which serves as the EU’s antitrust and technology regulator, announced that it had forwarded its preliminary findings to Apple after an investigation initiated in March.
The Digital Markets Act
The Commission’s initial accusation against Apple is the first under its groundbreaking Digital Markets Act, which aims to limit Big Tech’s influence and guarantee a level playing field for smaller competitors. A final decision must be made by March of the following year.
DMA violations may result in a fine of up to 10% of a company’s global annual turnover.
Margrethe Vestager’s Criticism
Margrethe Vestager, the EU’s antitrust director, criticized Apple’s revised terms for failing to adhere to the DMA. Apple may avoid a fine by amending its business terms to resolve the concerns.
“In their current state, we believe that these new terms do not permit app developers to communicate freely with their end users or to enter into contracts with them,” she stated at a conference.
She stated that Apple was responsible for determining how to comply with the DMA, and she was not permitted to dictate the company’s actions.
Apple’s Response
Apple stated that it had implemented numerous modifications in recent months to ensure compliance with the DMA, following feedback from the Commission and app developers.
In an email, it stated, “We will persist in our attentive listening and constructive dialogue with the European Commission, as we have consistently done.”
Additional Contractual Obligations
Additional Contractual Obligations
The EU executive also announced that it would investigate the iPhone manufacturer regarding its new contractual obligations for third-party app developers and app stores and whether they were both proportionate and necessary.
The issues are the core technology fee, the multi-step user journey to acquire and install alternative app stores on iPhones, and the eligibility requirements for developers to offer alternative app stores or directly distribute apps from the web on iPhones.
In March, Apple implemented new fees in the European Union that include the core technology charge for significant app developers, regardless of whether they utilize any of its payment services. This decision drew criticism from Epic Games, the creator of Fortnite, and other groups.
Vestager also criticized Apple’s announcement last week that it would postpone the introduction of its AI-powered features in the EU, which the company attributed to the DMA. According to Vestager, Apple’s AI integration appeared to be anti-competitive.
The fate of Apple’s compliance with the European Commission’s Digital Markets Act remains uncertain as the company faces the consequences of its actions. The EU’s insistence on fair competition and transparency casts a shadow over the tech giant.
* What is the purpose of the Digital Markets Act?
The aim of the Digital Markets Act is to safeguard fair competition and transparency in digital technology markets, particularly for smaller entities.
* What is the potential fine that Apple may face?
The potential fine for violating the Digital Markets Act stands at up to 10% of the company’s global annual turnover.
* Have other tech companies been sanctioned for similar offenses?
No, Apple has reportedly been the first to face allegations for violating the Digital Markets Act.
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