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The iPhone maker could be fined up to 10pc of its global turnover if it is found to be in breach of Spanish and EU competition laws following the investigation.
Spain’s antitrust watchdog is investigating Apple for anti-competitive behaviour relating to its App Store.
The National Commission for Markets and Competition (CNMC) announced today (24 July) that it is investigating Apple for breaking competition rules in Spain and the EU by “imposing unfair trading conditions” on developers who use the App Store to distribute their apps.
CNMC said that if it finds Apple guilty of the allegations, the iPhone maker’s conduct could constitute an abuse of a dominant position prohibited by Spanish competition laws and an article relating to the Treaty on the Functioning of the European Union (TEFU).
“These practices could be considered a very serious infringement of [Spanish law], which may lead to fines of up to 10pc of the total worldwide turnover of the offending companies in the year preceding the imposition of the fine,” a release originally published in Spanish reads.
The watchdog said that there is now a 24-month deadline on this investigation.
“Since the App Store launched more than 15 years ago, Apple has had two simple goals: creating a safe and trusted marketplace for our users, and providing an incredible business opportunity for developers,” an Apple spokesperson told SiliconRepublic.com.
“Today, Spanish developers of all sizes compete on a level playing field on the App Store, sharing their passion and creativity with users around the world, on a platform that is secure and trusted. Apple will continue to work with the Spanish competition authority to understand and respond to their concerns.”
Background
Last month, the European Commission found Apple’s App Store to be in breach of the Digital Markets Act (DMA), which was introduced in 2022 to crack down on anticompetitive behaviour among Big Tech companies.
Apple said earlier in the year it will allow EU users to download apps from competing app stores on iOS to comply with the DMA.
Apple has always insisted its closed ecosystem is good for security. Despite this exception for the EU market, the company said at the time it had no plans to expand the changes into other markets.
“Inevitably, the new options for developers’ EU apps create new risks to Apple users and their devices. Apple can’t eliminate those risks, but within the DMA’s constraints, the company will take steps to reduce them,” the company wrote at the time.
“Across every change, Apple is introducing new safeguards that reduce – but don’t eliminate – new risks the DMA poses to EU users.”
However, the EU’s “preliminary view” last month was that Apple’s App Store rules are in breach of the DMA as they prevent app developers from freely steering consumers to alternative channels.
Under the DMA, developers distributing their apps on Apple’s App Store should be able to inform their customers of alternative cheaper purchasing possibilities and steer them to those offers. But the European Commission said none of the App Store’s business terms allow developers to freely steer their customers.
For example, developers can’t provide pricing information in the app or communicate “in any other way with their customers to promote offers available on alternative distribution channels”.
The investigation also found that the fee Apple receives when developers acquire a new customer from the App Store is “beyond what is strictly necessary for such remuneration”.
Apple recently announced that it was delaying the release of new features, including Apple Intelligence, for its products in the EU, due to the challenges of complying with the DMA.
Earlier this month, Epic Games said Apple has approved its app store submission for iOS devices after initially rejecting it. The Fortnite maker recently criticised Apple of unfairly blocking its attempts to launch a dedicated Epic Games Store for iOS devices.
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Updated, 2.40pm, 24 July 2024: This article was updated to include a comment from an Apple spokesperson.
