The European Union’s Digital Markets Act took effect earlier this year with the goal of tackling anti-competitive behaviors from big tech companies, among other things. That’s why Apple rolled out a bunch of changes to the App Store, iOS, Safari web browser, and payment processing earlier this year… with most of those changes only applying in the EU.
But after opening an investigation in March, the European Commission has issued a preliminary finding that Apple is still violating the DMA by throwing up roadblocks that make it challenging for developers to let users know about alternate ways to pay for apps and services. The Commission has also launched a second investigation looking into the “core technology fee” that Apple charges for apps installed outside of the App Store.
In a nutshell, Apple does now allow developers to provide links that users in the EU can click to “complete a transaction for digital goods and services” on an external website. But developers cannot include any information about pricing or any reasons why you’d want to click that link rather than using Apple’s App Store billing services. Apple also charges fees on purchases made after a user clicks one of those links, which is technically allowed, but the European Commission claims “the fees charged by Apple go beyond what is strictly necessary” to cover the costs associated with “the initial acquisition of a new customer by developers.”
Keep in mind that this is just a preliminary ruling and that the European Commission doesn’t have to issue a final ruling until March 25, 2025. But if the charges are upheld, Apple could be fined up to 10% of its total global revenue. The Verge notes that means the fine could be as high as $38 billion. The fine could rise as high as 20% ($76 billion) for a repeat offense.
For now, Apple claims that its rules do comply with the DMA. In statements issued to The Verge and Engadget, the company says that under its new rules most developers “would pay the same or less in fees to Apple under the new business terms we created” and that “all developers doing business in the EU on the App Store have the opportunity” to use Apple’s new rules for directing users to complete purchases on the web. But I suspect the most important part of the statement is the bit where Apple says it “will continue to listen and engage with the European Commission,” because it seems pretty clear that unless something changes, the EC currently plans to issue potentially massive fines against the company.