Europe's Digital Market Act Comes Into Force
European Union regulators have accused Apple of being in breach of new laws designed to restrict big tech companies.
The European Commission said that according to the preliminary findings of its investigation, the restrictions that the iPhone maker imposes on developers using its mobile App Store had breached the 27-nation Union’s Digital Markets Act (DMA).
Right now, Apple charges developers an average of 30% commission on products sold in its App Store.
In May, the EU’s DMA went into force, with an aim of controlling the behaviour of big technology companies and regulating online marketplaces. It has led to conflict between the EU and many of the firms the legislation covers, including Apple.
The European Commission, which regulates competition in the EU, said Apple's App Store squeezes out rival marketplaces, marking the first time it has found a company in breach of the Digital Markets Act (DMA).
The firm faces a potential fine of up to 10% of its global revenue if it fails to comply with the rules. The Competition Commission also opened an additional investigation to decide whether the "core technology fee," which Apple charges developers, is compliant with EU rules. Apple said it is "confident our plan complies with the law".
Apple has been given the opportunity to review the investigation's preliminary findings, and it can avoid a potentially enormous fine if it comes back with a proposal which is satisfactory to the EU.
The European Commission says that developers should be able to freely tell customers when there are cheaper app stores available beyond the one run by Apple. Previously, it was told to allow alternatives in the EU in March. In response, Apple said it has made changes in the past few months to ensure it complies with the DMA. "We estimate more than 99% of developers would pay the same or less in fees to Apple under the new business terms we created," it said in a statement. "All developers doing business in the EU on the App Store have the opportunity to utilise the capabilities that we have introduced, including the ability to direct app users to the web to complete purchases at a very competitive rate."
Another of Apple's main arguments is that users benefit from strong security measures by sticking to the official App Store. In response, the Commission says it will happily discuss security issues. “We are confident our plan complies with the law, and estimate more than 99 per cent of developers would pay the same or less in fees to Apple under the new business terms we created,” the company said in a statement.
EU Commission | Apple | LeMonde | CNet | BBC | Politico | Independent | AP News
Image: matcuz
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