Digital Markets Act

🌈 Abstract

The article discusses the European Commission's preliminary findings that Apple's App Store rules are in breach of the Digital Markets Act (DMA), as they prevent app developers from freely steering consumers to alternative channels for offers and content. The Commission has also opened a new non-compliance procedure against Apple over concerns that its new contractual requirements for third-party app developers and app stores, including Apple's new "Core Technology Fee", fall short of ensuring effective compliance with Apple's obligations under the DMA.

🙋 Q&A

[01] Preliminary findings on Apple's steering rules for the App Store

1. What are the Commission's preliminary findings on Apple's steering rules for the App Store?

• The Commission preliminarily finds that Apple's three sets of business terms governing its relationship with app developers, including the App Store's steering rules, do not comply with Article 5(4) of the DMA, which requires gatekeepers to allow app developers to steer consumers to offers outside the gatekeepers' app stores, free of charge.

2. What are the potential consequences if the Commission's preliminary views are confirmed?

• If the Commission's preliminary views are confirmed, the Commission would adopt a non-compliance decision within 12 months from the opening of proceedings on 25 March 2024.

[02] New non-compliance investigation into Apple's contract terms

1. What is the focus of the new non-compliance investigation into Apple's contract terms?

• The Commission will investigate whether Apple's new contractual requirements for third-party app developers and app stores, including the provision of alternative app stores or the possibility to offer an app via an alternative distribution channel, breach Article 6(4) of the DMA and notably the necessity and proportionality requirements provided therein.

2. What other investigatory steps will the Commission take in parallel?

• The Commission will continue undertaking preliminary investigative steps outside of the scope of the present investigation, in particular with respect to the checks and reviews put in place by Apple to validate apps and alternative app stores to be sideloaded.

[03] Background information

1. When did the designated gatekeepers have to fully comply with all DMA obligations?

• Alphabet, Amazon, Apple, ByteDance, Meta and Microsoft, the six gatekeepers designated by the Commission on 6 September 2023, had to fully comply with all DMA obligations by 7 March 2024.

2. What are the potential consequences for gatekeepers in case of an infringement of the DMA?

• The Commission can impose fines up to 10% of the gatekeeper's total worldwide turnover, which can go up to 20% in case of repeated infringements. Moreover, in case of systematic infringements, the Commission is also empowered to adopt additional remedies such as obliging a gatekeeper to sell a business or parts of it, or banning the gatekeeper from acquisitions of additional services related to the systemic non-compliance.