Accusations from Brussels

Apple faces billions in fines in the EU

According to Brussels, the US group is said to be violating competition rules with its App Store.

(Bild: AFP)

The EU Commission has launched an investigation into Apple for possible violations of new rules for large online platforms. The investigation will examine whether the US company is complying with its obligation to direct users to offers outside of its own App Store free of charge.

"The developer community and consumers are very interested in offering alternatives to the App Store. We will investigate the matter to ensure that Apple does not undermine these efforts," said EU Competition Commissioner Margrethe Vestager.

Since the beginning of March, companies have had to comply with the Digital Markets Act (DMA). It is intended to ensure more competition for digital services and better opportunities for new rivals. The basic assumption is that some large platform operators have become so powerful that they could cement their market position. The DMA is intended to break this up with rules for the so-called gatekeepers. These include the US heavyweights Apple, Amazon, Microsoft, Alphabet and Meta.

Criticism of core technology fee
The EU Commission also has doubts as to whether Apple's so-called core technology fee is proportionate. Among other things, the company introduced this annual fee in March with new terms and conditions. It amounts to 50 cents for each initial installation of an app after exceeding the threshold of one million downloads in a twelve-month period.

At the same time, developers can also remain in the previous model, in which they continue to distribute their applications only via Apple's App Store. As before, they then pay a levy of 15 or 30 percent of digital revenues within the app.

Apple rejects accusations
Apple refuted the Commission's accusations, saying that it had made a number of changes in recent months to comply with the DMA. "We are confident that our plan complies with the law." It is estimated that more than 99 percent of developers will pay the same or fewer fees to Apple with the new terms and conditions.

All developers operating in the App Store in the EU will be able to take advantage of the features introduced by Apple, including the ability to redirect app users to the internet to complete purchases "on very competitive terms". "We will continue to listen to and cooperate with the European Commission."

Apple faces billions in fines
Should the Commission come to the final conclusion that Apple is in breach of the DMA, it could face fines of up to ten percent of its annual turnover - and up to 20 percent in the event of repeated breaches. As a final option, the companies could also be broken up. In the end, courts could decide on possible penalties.