Update: Apple has responded to the ruling with a statement provided to 9to5Mac, calling it “bad for innovation, bad for competition, bad for our products, and bad for users.” See full statement below.
The European Commission has officially published its full ruling against Apple’s App Store practices in the European Union, and the message is clear: the company’s new “DMA-compliant” terms… still aren’t compliant.
Fix it up, or pay up
Following its initial €500 million fine in April, the European Commission is now giving Apple 30 days to fully align its App Store rules with the Digital Markets Act (DMA). If it fails to comply, the EU says it will start imposing “periodic penalty payments” until Apple does:
“In view of the seriousness of Apple’s non-compliance with Article 5(4) of Regulation (EU) 2022/1925, as established in this Decision and considering that the non-compliance has been found to be on-going, the Commission concludes that it is necessary to impose periodic penalty payments pursuant to Article 31(1), point (h), of Regulation (EU) 2022/1925 if Apple were to fail to implement measures that bring the infringement effectively to an end within 60 calendar days from the date of notification of this Decision.
Any periodic penalty payments that may be definitively set should be sufficient to ensure compliance by Apple with this Decision and may take account of Apple’s significant financial resources (see recitals (286) and (307) of this Decision).”
And
“If the addressee of this Decision fails to comply with Article 3 within 60 calendar days from the date of notification of this Decision, it shall incur periodic penalty payments not exceeding the limit stipulated in Article 31(1) of Regulation (EU) 2022/1925, from the date on which it is required to bring the non-compliance effectively to an end pursuant to Article 3, until the date on which it complies with the Decision.”
At the heart of the issue is Apple’s approach to anti-steering restrictions, which prevent app developers from telling users they can pay for services outside the App Store environment. Under the DMA, gatekeepers like Apple must let developers inform users about alternative payment options, promote those options inside their apps, and complete transactions—free of charge.
Apple did make changes earlier this year. But according to the new ruling, those changes fall short in just about every way.
‘Apple has not put forward any convincing arguments’
Top comment by Blurft
Apple argued that the DMA doesn’t require it to “technically enable” or “facilitate” steering, but rather to simply “allow” for it. The Commission rejected that interpretation, saying Apple’s restrictions, fees, and technical limitations “undermine the effectiveness” of the law.
So Apple's position is essentially "We don't have to make this easy for developers, we just have to make it technically possible...thus we're going to create as many hurdles and as much friction as possible to make it so that users will become frustrated trying to take advantage of it and just resort to using our version instead."
It's plainly anti-competitive.
Each individual thing Apple tries to do may be legal and seem reasonable in isolation, but together the form a pattern - along with Apple's malicious "compliance" in other jurisdictions - of anti-competitive behavior that clearly violates the intent of these laws.
It's like a RICO case, where each individual action may be legal on its own, but together and to with a certain intention are corrupt and thus illegal.
I do not understand how Apple executives don't see the obvious negative effects this will have on Apple long term. Regulators are going to respond to this bad faith "effort" by Apple by crafting future legislation with even harsher terms and stricter language, and Apple will not have the influence or input that they might have if they just tried to work with regulators today.
It's irresponsible and harmful to Apple's long-term prospects.
The Commission evaluated Apple’s original App Store terms, its new business terms introduced in March, and a separate version for music streaming apps. In all cases, it found Apple is still not compliant:
“It follows from the above that Apple has not put forward any convincing arguments calling into question the serious gravity of the non-compliance.”
Under Apple’s new proposed rules, developers can include one external link per app to their own website. However, they must use Apple’s format, can’t include pre-filled user data in the URL, and must show a scare sheet before the link actually opens. Also, Apple charges a 27% commission on these purchases, instead of the 30% it collects for in-app purchases.
Apple argued that the DMA doesn’t require it to “technically enable” or “facilitate” steering, but rather to simply “allow” for it. The Commission rejected that interpretation, saying Apple’s restrictions, fees, and technical limitations “undermine the effectiveness” of the law.
Update: in a statement provided to 9to5Mac, an Apple spokesperson said:
“There is nothing in the 70-page decision released today that justifies the European Commission’s targeted actions against Apple, which threaten the privacy and security of our users in Europe and force us to give away our technology for free. Their decision and unprecedented fine came after the Commission continuously moved the goalposts on compliance, and repeatedly blocked Apple’s months-long efforts to implement a new solution. The decision is bad for innovation, bad for competition, bad for our products, and bad for users. While we appeal, we’ll continue engaging with the Commission to advocate on behalf of our European customers.”
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