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Apple’s App Store breaches EU’s Digital Markets Act (techcrunch.com)

submitted 4 months ago by [email protected] to c/[email protected]

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A few months after opening a non-compliance case on Apple and the Digital Markets Act (DMA), the European Commission has shared its preliminary findings with Apple. And the bottom line is that the current App Store rules are in breach of the DMA. Confirmed violations of the DMA can lead to fines of up to 10% of global annual turnover.

“‘Act different’ should be their new slogan,” the EU’s internal market commissioner, Thierry Breton, wrote on X. “For too long, Apple has been squeezing out innovative companies — denying consumers new opportunities & choices.”

In this particular case, the European Commission believes third-party developers should be able to inform customers of alternative purchasing possibilities — free of charge.

For instance, developers who have released apps on the App Store can’t advertise different prices or alternative distribution channels in their apps. While Apple now allows developers to include a link to their site, the European Commission believes there are too many restrictions with this link-out mechanism.

Even if developers redirect users to their websites and handle transactions on their websites, they have to report transactions to Apple and pay a commission. Apple only waives a 3% payment processing fee for web purchases.

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[+] [email protected] 25 points 4 months ago* (last edited 3 weeks ago) (1 children)

[deleted]

[–] [email protected] 28 points 4 months ago* (last edited 4 months ago) (1 children)

From another article it said that they have 12 months to fix their violation. If they don't comply by then the EU can issue the fine.

Edit: Here is the article: https://www.theguardian.com/technology/article/2024/jun/24/apple-breach-eu-competition-rules-digital-markets-act

[–] [email protected] 22 points 4 months ago* (last edited 4 months ago) (2 children)

IMO 12 mo is too much. They will wait till the dead line to public the "fix."

[–] [email protected] 10 points 4 months ago (2 children)

Yeah, they will, but I think for this to work and be respected, they need to give companies this period, because it actually could take alot of time to change.

In this case, not so much, but it could be in the future, and the rules are the same regardless.

[–] [email protected] 7 points 4 months ago (3 children)

The intent is to allow companies time to implement the change. But if you'll pardon my cynicism, in practice, what ends up happening is companies just use it as a tactic to delay the implementation and continue recording the revenue.

At the very least they should forfeit the revenue that they earn during the period for this. I'm not sure exactly how the fines work and whether they take this into account, but I doubt Apple is seriously going to use the 12-month period to actually come clean and change their ways. I think they'll just use it as more time to come up with some new bullshit form of non-compliance.

[–] [email protected] 6 points 4 months ago* (last edited 4 months ago)

If after 12 monty they actually comply then thats still a positive.

However i fear they may “fix” it with malicious compliance at 11 months and then the cycle repeats.

Instead what i think should happen is they should need to obtain “verified compliance” within a year. (Minus the time europe takes to check) and if the term expires the penalty goes up to eventually forced splitting up.

[–] [email protected] 2 points 4 months ago* (last edited 4 months ago)

forfeit the revenue that they earn during the period for this

I like this. This will give them the urgency and motivation to plug the hole ASAP, rather stall and repeat the cycle.

[–] [email protected] 2 points 4 months ago* (last edited 4 months ago)

I actually agree with you, that Apple most certainly will stall. And I also don't think it's optimal, but huge decisions on how to go forward do take time.

And I just think it may be better in the long run, that it seems more "fair" for the company, even thought it's not.

Also, if Apple doesn't comply this time and tries to find a new bullshit form of non-compliance, there's no second chance according to the EU law. The fine will hit, so they certainly won't do that.

[–] [email protected] 2 points 4 months ago

That's 90% of a year's revenue they could be missing out if they fixed it now, yeah