Apple’s online Application (App) Store has been found in breach of Europe’s digital laws according to the European Union council.
The European Union has informed Apple that its App Store is violating the bloc’s Digital Markets Act (DMA).
First Firm Penalized
This makes Apple the first company out of a group a massive tech firms to get busted for breaking the new sweeping digital competition law.
The Commission may potentially fine Apple up to 10% of its global revenue, for its conduct.
Apple earned US$383 billion ($575 billion) in revenue for 2023, making any payout a substantial amount to be paid.
The fine may potentially rise to 20% of revenue for repeated violations for the digital law, as per the stipulations of the legislation.
Breaking the Rules
In a statement, the European Commission said Apple’s App Store rules breach the DMA by preventing developers from directing consumers to alternative payment methods.
As a result Apple company is charging excessive fees for in-app purchases made within seven days of signing up via external links.
The preliminary finding follow the EU’s €1.8 billion antitrust fine imposed on Apple in March for restricting streaming application developers developers.
A final decision by the EU regarding the fate of Apple is expected by 25 March 2025.
Delayed Rollout
Apple in response said it would delay the roll out of planned artificial intelligence features in Europe due to regulatory concerns driven by the DMA.
The EU Commission also confirmed it will investigate Apple’s multi-step process for downloading alternative app stores on iPhones.
A process which may be deemed preventative to open competition, which would present Apple as liable to the accusations.
The commisson will also investigate Apple’s new Core Technology Fee, which charges developers based on app downloads.
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Changes to Apple
Apple replied by stating it has made changes since the accusations were made to ensure compliance with the DMA.
Apple claims that most developers will pay the same or lower fees under agreement of the new terms.
“Today is a very important day for the effective enforcement of the DMA, the developers’ community and consumers are eager to offer alternatives to the App Store. We will investigate to ensure Apple does not undermine these efforts.”
– Margrethe Vestager, the Commission’s executive vice president in charge of competition policy
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