Apple may become the first tech giant to face formal charges from the European Commission for allegedly violating the Digital Markets Act. The Cupertino firm has been accused of enforcing rules on “steering,” which involves charging app developers for directing users towards third-party purchase options. Apple takes a 30% commission on in-app purchases, leading to a decrease in profits when users make payments through their phone browser.
The European Commission initiated investigations in March 2024 into Alphabet, Apple, and Meta for potential gatekeeping practices that promote their own services above competitors. Apple and Meta are priority cases, while regulators are still exploring whether Alphabet favors its own app store and services in Google results.
In addition to the rules on steering, the European Commission could penalize Apple for new fees imposed on E.U. app developers in response to the DMA in January. Meta’s charges are related to ad-free subscription tiers that may not provide a real alternative if users do not consent, according to sources.
The DMA is an E.U. regulation established in 2022 to promote fairness and competition among digital products and services. Major tech firms labeled as “gatekeepers” must comply with obligations such as providing user access to collected data, allowing third-parties to operate on their platforms, and allowing users to uninstall pre-installed software.
Noncompliance with the DMA can result in fines of up to 10% of the company’s total worldwide turnover, potentially increasing to 20% in cases of repeated infringement. Apple responded to the DMA’s requirements in January by making changes to its pricing structure to comply with the regulations.
E.U. regulators are expected to make a decision on charging Apple in the coming weeks, with an announcement likely before the European Parliament’s summer break in August. Apple may be the first tech giant to face penalties, followed by Meta. A second investigation focusing on Apple’s web browser choice screen may take longer to conclude. Charges are expected to be announced before November when Margrethe Vestager, the European Commissioner for Competition, leaves office. Apple and Meta still have the opportunity to address concerns before a final decision is made.
