EU is reportedly going to fine Apple over failure to comply with the Digital Markets Act

Posted:
in iOS edited June 14

Reports say that the European Union is about to issue Apple with the first-ever fine of a company under its Digital Markets Act, and specifically over anti-steering measures in the App Store.

European Union flags fluttering with a backdrop of modern glass building facades.
EU flags in Brussels



The EU has already fined Apple $2 billion over its alleged blocking of rivals to Apple Music from promoting their potentially cheaper alternatives. Subsequently, it was reported that the European Union was assessing whether Apple has now complied with the ruling.

According to the Financial Times, the EU has concluded that Apple has not, or at least that it hasn't complied sufficiently. Three unspecified sources said to have close knowledge of the investigation, say that the EU is about to issue a new fine against Apple.

The investigation was conducted specifically under the powers granted by the Digital Markets Act. This would mean that Apple is the first company to be fined under that law -- although reportedly both Meta and Google are still under investigation.

Allegedly, the conclusion that Apple has not complied with its obligations, is provisional. The EU is said to believe that Apple has failed to allow developers to promote their alternative offerings, and without imposing fees.

Apple will be able to take action to correct its practices, and the EU officials could then reconsider their decision before imposing a fine. The sources also say that the announcement of the fine could take place in the next few weeks, but the schedule is not set yet.

Should the EU choose to charge Apple over breaking the Digital Markets Act, the fine could be substantial. The law allows for daily penalties of up to 5% of its average daily worldwide turnover.

At present, that would mean a potential fine of up to $1 billion per day.

Apple's Craig Federighi making a speech at Web Summit 2021
Craig Federighi speaking against third-party app stores at Web Summit in 2021 (Credit: Web Summit)



Apple has not commented on the report and isn't expected to until, or unless, the EU announces the charge. However, the company previously issued a statement to AppleInsider regarding its compliance with the law.

"We're confident our plan complies with the DMA, and we'll continue to constructively engage with the European Commission as they conduct their investigations," said Apple. "Teams across Apple have created a wide range of new developer capabilities, features, and tools to comply with the regulation."

"At the same time, we've introduced protections to help reduce new risks to the privacy, quality, and security of our EU users' experience," continued the company. "Throughout, we've demonstrated flexibility and responsiveness to the European Commission and developers, listening and incorporating their feedback."

Also throughout the process of working to comply with the Digital Markets Act, Apple has stressed that being forced to allow alternative app stores is a security risk. Apple's software engineering chief, Craig Federighi, even described sideloading apps outside of the App Store as being "a gold rush for the malware industry."

The Digital Markets Act is the EU's attempt to control against abuses of market dominance by Big Tech firms. It is the first such act to be passed into law, but other countries are attempting to mimic it.



Read on AppleInsider

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Comments

  • Reply 1 of 27
    One wonders if the fines get large enough if Apple would simply abandon Europe as a market. Seems unlikely but if say the EU issued a $100 billion fine - which is just a 100 day non-compliance period - why would Apple do business there?
    ssfe11danoxAlex1Nappleinsideruserzeus423watto_cobra
  • Reply 2 of 27
    mubailimubaili Posts: 454member
    is the EU saying Apple should just giving away stuff for free?
    ssfe11darelrexdanoxwilliamlondonAlex1Nappleinsideruserwatto_cobra
  • Reply 3 of 27
    AfarstarAfarstar Posts: 59member
    The EU is a truly shocking organisation. I’m a Brit and happy to be independent from such a far reaching state. They haven’t got a clue how big tech and security works. 
    danoxzeus423watto_cobra
  • Reply 4 of 27
    ssfe11ssfe11 Posts: 52member
    The EU is absolutely clueless and yes they are actually strong arming Apple to pacify Spotify. It’s absurd and the US govt should intervene and not let other countries bully us!
    danoxAfarstarMisterKitzeus423watto_cobra
  • Reply 5 of 27
    ssfe11ssfe11 Posts: 52member
    The EU acts all high and mighty but in reality the EU represents barely 7% of Apple App Store revenue lol!!
    danoxAfarstarwatto_cobra
  • Reply 6 of 27
    avon b7avon b7 Posts: 7,897member
    ssfe11 said:
    The EU is absolutely clueless and yes they are actually strong arming Apple to pacify Spotify. It’s absurd and the US govt should intervene and not let other countries bully us!
    Isn't that totally backwards?

    Shouldn't it be: "in my house, my rules"?

    Why should the US government be intervening in what the EU does? 

    The rules are there. Apple thinks it's complying. The EU thinks it isn't. 

    Wait for action and then respond. Apple will appeal. Let the process follow its normal course. 
    gatorguyAlex1NScot1muthuk_vanalingamspherickurai_kage
  • Reply 7 of 27
    TravisVTravisV Posts: 14member
    The problem with the EU is that a lot of the counties are socialist leaning which is the exact opposite of the US and the everything that it represents when doing business. Microsoft went through this years ago with the early EU and now companies like Google, Apple and other are finding that they are hitting the proverbial brick wall with the EU. Apple will loose more in the long run if they don't abide with the socialist EU rules. 
    williamlondon
  • Reply 8 of 27
    slurpyslurpy Posts: 5,385member
    Love how trolls and scam artists like Epic and Spotify CEOs are basically dictating EU's actions irt Apple. They just fucking whine, and EU takes action. It's absolutely absurd. Apple has taken MASSIVE actions and made deep, immense changes in in its software, spent billions of dollars in order to offset this with additional security requirements, in order to accommodate everything the EU demanded, and its still not enough. What a corrupt institution. 
    ssfe11tmaywilliamlondonforegoneconclusionzeus423watto_cobra
  • Reply 9 of 27
    Afarstar said:
    The EU is a truly shocking organisation. I’m a Brit and happy to be independent from such a far reaching state. They haven’t got a clue how big tech and security works. 
    Oh dear.

    You’re not independent from the EU’s legislation which is why you have to abide by the EU’s rules when you travel there, why our manufacturing has to comply with it’s legislation if the UK wants to sell there, and so on.
    williamlondonAlex1Nspheric
  • Reply 10 of 27
    shrave10shrave10 Posts: 56member
    Apple should complain to the DOJ about Big Five music labels colluding to prop up Spotify so that they can rip off consumers one end and music artists at the other end simultaneously.   Apple might then recoup costs of unfair EU fines by growing Apple Music market share
    williamlondonAlex1Nwatto_cobra
  • Reply 11 of 27
    More proof that the EU will use the DMA to constantly move the goalposts and claim violations. The fact that they’re not going to immediately impose a fine means that the “violation” isn’t really clear in the original language.
    tmayAlex1Ntht9secondkox2watto_cobra
  • Reply 12 of 27
    This seems to be a never-ending story. Europe is not worth it. Apple should just leave the market altogether.

    zeus4239secondkox2watto_cobra
  • Reply 13 of 27
    sphericspheric Posts: 2,626member
    Afarstar said:
    The EU is a truly shocking organisation. I’m a Brit and happy to be independent from such a far reaching state. They haven’t got a clue how big tech and security works. 
    Which is an amusing standpoint, because a rather large portion of EU legislation was actually written by the Brits, before a handful of millionaires decided they no longer wanted to comply with upcoming tax haven regulation and started a campaign to get out. 

    How are those trade deals coming along, BTW? 
    avon b79secondkox2
  • Reply 14 of 27
    sphericspheric Posts: 2,626member

    This seems to be a never-ending story. Europe is not worth it. Apple should just leave the market altogether.

    Considering that the United States is looking at similar regulation, maybe Apple should just leave that market, as well? And Japan? And Australia? 

    Hell, maybe Apple should just close up shop. 
    williamlondonmuthuk_vanalingam9secondkox2
  • Reply 15 of 27
    sphericspheric Posts: 2,626member

    ssfe11 said:
    The EU acts all high and mighty but in reality the EU represents barely 7% of Apple App Store revenue lol!!
    1. EU: "Hey, follow our laws!" 

    2. Apple: "Uh…okay. Here, we're following your law, but we're enacting levies to make sure it won't make a difference." 

    3. EU: "We see what you did there. You know exactly that's not what we meant. Stop it." 

    4. Some dude on the internet: "The EU acts all high and mighty" 
    williamlondonavon b7gatorguymuthuk_vanalingamkkqd13379secondkox2
  • Reply 16 of 27
    tmaytmay Posts: 6,439member
    https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32022R1925

    For all of you that want to navigate the GMA, see above...




    watto_cobra
  • Reply 17 of 27
    nubusnubus Posts: 486member
    TravisV said:
    The problem with the EU is that a lot of the counties are socialist leaning which is the exact opposite of the US 

    This is not a problem with EU. The US states didn't gain independence by being clones of European nations. There are differences and it is not a problem.

    Apple is capable of selling to China and India. It isn't even hard to sell to EU without getting fined.
    Other US companies do this every day. Ford, IBM, McDonald's, Microsoft, Coca Cola,...

    If you run a "Double Irish with a Dutch sandwich" for tax evasion then EU will hit you hard to protect the market.
    If you don't allow users to repair, act as a gatekeeper, insist on a proprietary charging connector after having promised switching to USB for 15 years... then EU will hit you.

    The problem is Apple.
    muthuk_vanalingamavon b7williamlondon9secondkox2
  • Reply 18 of 27
    sphericspheric Posts: 2,626member
    nubus said:

    Other US companies do this every day. Ford, IBM, McDonald's, Microsoft, Coca Cola,…
    Fun facts: 

    Ford was fined by the EU for emissions fraud (and by the US for circumventing import tariffs)

    IBM avoided a heavy EU antitrust fine for abusing their position in supercomputing by making major concessions and offering to redress past imbalances. 

    McDonald's was severely fined in at least one EU nation for tax avoidance. 

    Microsoft… hahahhahahahaha… oh boy. Just Google "Microsoft vs. EU". 

    Coca-Cola has had all manner of antitrust probes and fines and settlements in the EU, almost continuously over the past twenty years.  
    muthuk_vanalingamwilliamlondon
  • Reply 19 of 27
    kkqd1337kkqd1337 Posts: 446member
    The EU is doing some good work here.

    I hope Apple are forced to make some substantive changes. 
    nubus9secondkox2williamlondon
  • Reply 20 of 27
    This is mostly Apple's fault for incredible greed and control.  If they adopted their own security-app model for macOS for iPadOS/iPhone OS, aka normal app loading going back decades, the entire issue would go away.  Bring normal app loading to the iPhone Apple.  Consumers wanted larger screens and multiple carriers.  Apple had to deliver or lose marketshare.  This consumer, and millions of other consumers, wants application freedom for his iPhone and iPad.  I want normal Firefox.  I want an uncrippled file system.  It is in your interest to Apple.  The reason the iPad sales are in a slump is lack of freedom.  You cannot use an iPad to do much useful when iPadOS restricts everything.  You end up with a powerful M4 SoC totally crippled so people go buy Macs or Windows machines, mostly Windows machines.  The public actually prefers slower more power hungry Intel chips to fast low powered Apple Silicon because Windows gives them the freedom to do what they want and iPadOS doesn't.  It is time for change Apple.  Steve Jobs knew when it was time to change.  Does Tim Cook?
    muthuk_vanalingamwilliamlondon
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