Thursday, November 21, 2024
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Apple faces first EU fine under Digital Markets Act

Apple could become the first company to be fined under the European Union’s new digital antitrust rules for large technology corporations. The European Commission is preparing to fine Apple for practices that the regulator believes limit competition in the App Store.

Earlier in March 2024, the European Commission had already fined Apple €1.84bn (about $2bn) after investigating a complaint by music streaming service Spotify. The Commission concluded that Apple had prevented app developers from redirecting users to cheaper payment options for purchases outside the App Store, which is unacceptable under the Digital Markets Act (DMA).

The amount of the new fine is not yet known, but the DMA provides for penalties of up to 10% of a company’s annual worldwide turnover for a first offence and up to 20% for repeat offences. Given Apple’s revenues last year, the fine could reach $38bn. The European Commission is expected to announce its decision this month, even before Competition Commissioner Margrethe Vestager steps down.

Apple is also under investigation for allegedly obstructing the development of alternative app shops in the EU. In addition, the EU won a case in September 2024 that requires Apple to pay €13bn ($14.4bn) in unpaid tax. Apple CEO Tim Cook allegedly even appealed to Donald Trump about the fines imposed on the company. At the moment, Apple has not officially commented on the impending fine.

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