Apple has a month to comply with EU antisteering mandate, or get fined again
Apple has a month left to make its App Store rules compliant with EU Digital Markets Act antisteering provisions, or the fines will keep coming.
The full ruling outlines the EU's 500 million euro fine against Apple
On April 23, following multiple reports that the EU was delaying the issuing of fines against Apple and Meta, Europe finally pulled the trigger. It announced that it would fine Apple and Meta millions of euros for failing to comply with the Digital Markets Act.
Over a month later, on May 27, the European Commission published its full ruling on the matter. The 67-page document also outlines exactly what the punishment is to Apple, for failing to follow the regulation.
The bottom line is that Apple was fined 500 million euro ($567 million), with Apple being given three months to pay it to the European Commission. If it doesn't pay on time, it will have to pay interest on the due funds.
Apple also has to fix itself and end the non-compliance with the Digital Markets Act within 60 days of the April notification. If Apple does not, it faces the prospect of "periodic penalty payments" of an unspecified amount until it does comply.
Non-compliant anti-steering
The ruling covers how Apple is not complying with the DMA based on how its anti-steering rules are implemented. Originally, Apple prevented developers from telling consumers about ways to make payments for services and features that didn't go through Apple's systems.
Apple did change its rules under regulatory pressure, but did so in a way that didn't meet the requirements of the Digital Markets Act. These changes included allowing developers to share an external link with users, but with limitations.
Since Apple wouldn't get its 30% cut for usage of its In-App Purchases mechanism, Apple added a new requirement, effectively taking a 27% fee from these transactions outside of the App Store system.
In its ruling, neither the old nor new business terms complied with the regulation, since they restricted the ability for developers to promote their off-App Store offers in their apps. Forcing a fee instead of doing so free of charge was also seen as an issue, as is limiting links to one URL per app.
Repeatedly, Apple's arguments are denied in the ruling, such as its definition of "free" as its read in the regulation when taking into account nuances in different languages.
As for the fine, Apple argued that it should not be fined at all, due to the relative novelty of the regulation and taking into account Apple's "good faith efforts to engage" with the European Commission.
"None of Apple's arguments for not imposing a fine, or for reducing the fine, are convincing," the ruling reads.
Awaiting appeal
While the final ruling's publication in full seemingly brings to an end legal action that started back in May 2024, that's far from the reality of the situation. Like many other high-stakes lawsuits, the appeals process will take years to conclude.
Apple said at the time of the original ruling that it will appeal against the fine. Apple also took the opportunity to accuse the EU of discriminating against it, and of requiring Apple to hand over its technology to rival companies for free.
It is unclear if Apple has formally appealed, nor if Apple has made its 500 million euro payment.
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Comments
I think this takes the biscuit.
It's fine for Apple to disagree with the EU but to 'comply' with a requirement that expressly goes against anti-steering tactics by imposing a seperate system that effectively imposes the same financial burden on developers under a different name is not engaging in good faith efforts.
Apple is really earning itself a bad name here.
If the EU does not respond, then they cannot enforce the extortion charge.
A law that requires Apple to allow free linking to outside payments undermines the entire App Store business model.
This would be like a government deciding that Amazon is so big that nobody can realistically compete with them so they should be forced to allow people to list products on Amazon that link to their own stores without paying Amazon anything.
These arguments have been justified due to Apple having exclusive control of the platform but in the EU they already allowed 3rd party stores and they allow certain companies to operate exclusively controlled stores.
It's the biggest companies that are trying to take advantage of this. Microsoft owns Minecraft and Candy Crush, they could drop in-app purchases, link out to a Microsoft payment portal to topup coins in their accounts. Apple has to curate 1.5 billion customers and direct their traffic to Microsoft games without receiving anything in return. That's not a justified ruling.
If they want to make a fairer ruling to make the system more competitive like lower fees so be it but destroying their business model entirely is not the way to go about it and just serves as another example of technologically illiterate public officials wrecking businesses. They have no right to dictate to a company that they should offer a service to competing billion-dollar companies for free. It's high time the EU Commission had some 3rd party oversight because their interference in business is getting way out of control. Handling B2C issues is fair enough like data privacy concerns but they have no right to pick winners in B2B issues.
"The New Business Terms do not comply with Article 5(4) of Regulation (EU)
..."
Like I said, Apple is free to disagree but this is clear 'malicious compliance' to my mind and doubling down on the practice won't do it any favours.
Whether we like the law, think it is unfair or is detrimental to Apple's business model or don't agree with the reasoning, isn't the point here.
As for the 'business model' itself, Apple is lucky this regulation didn't pre-date it's current setup as in that case it would have never existed in its clearly anti-competition state in the first place. Apple has had an easy multi-billion dollar ride up to now.
It laughed all the way to the bank (and into the Paradise Papers).
Now things will have to change, but I can understand why Apple does not want things to change.
This is not a factual statement. Apple prevented them from doing so in the app and in the App Store. But companies like Spotify, Amazon and Netflix were still able to get customers to make payments online regardless. Those companies could use customer sign-up information to communicate and there was also the more generalized exposure for customers via web advertising, web search and web sites.