Apple is reportedly set to face prosecution in the European Union for alleged anti-competitive practices in its App Store, marking the first time that EU authorities have pursued a major tech company for breaching comprehensive digital law.
The European Commission, the EU’s antitrust watchdog, found that Apple had not complied with the Digital Markets Law, which came into force in March and targets tech giants designated as internet “gatekeepers.” The Financial Times reported.This was said citing a source familiar with the matter.
Specifically, Apple violated the DMA’s rules by charging app developers fees to “steer” customers away from the App Store, where Apple takes a significant portion of sales. Critics argue that Apple’s fees are excessive and stifle competition.
The EU’s charges against Apple could be formally announced within weeks, according to reports.
The European Commission’s findings are preliminary and Apple could still avoid fines by changing its business practices to comply with the DMA, according to people familiar with the matter.
The Post has contacted the European Commission for comment on the report.
Apple did not immediately respond to a request for comment.
The company’s shares were down more than 1% in afternoon trading on Friday.
According to the Financial Times, iPhone makers could be fined up to 5% of their average daily global sales for violating the law, or just over $1 billion per day.
The European Commission first announced in March that it was investigating Apple, as well as Google, Meta and Amazon, for possible breaches of the Digital Markets Act.
At the time, EU authorities said they were investigating whether Apple’s new compliance plans with the DMA, which included its practice of charging app developers a so-called “core technology fee” for access to the App Store, were “contrary to the objectives of the law.”
Authorities are reportedly still considering whether to file charges against other companies.
The EU charges will create new regulatory headaches for Apple.
In a separate case in March, European Union regulators slapped Apple with a massive $2 billion antitrust fine for “abusing its dominant position” in music streaming through its App Store practices.
Apple is appealing the fine.
In the United States, the Department of Justice recently filed a landmark antitrust lawsuit against the company, alleging that it engaged in anti-competitive conduct to ensure the iPhone’s dominance in the smartphone market.
