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Apple Facing A$75.72 Million Daily Fine In The EU For Breaching regulations

Apple is staring at the prospect of becoming the first major tech company to be fined under the newly introduced Digital Markets Act (DMA) in the EU.

For context, the DMA became enforceable in March and empowers the European Commission to regulate tech majors especially the “gatekeepers” of the industry – firms with a market capitalisation of at least A$122 billion and with a platform with 45 million monthly active end users in the EU. These would include the likes of Apple, Meta, Amazon and Alphabet.

In March itself, the European Commission said it was looking at potential breaches related to Apple’s new fee structure for alternative app stores. It was investigating whether Apple charges a “Core Technology Fee” for developers who want to “steer” users to offers outside of its App Store. There’s also an additional 3 per cent that goes to Apple if a developer uses its payment processor.

A new report in the Financial Times indicates that Apple has indeed been found to have breached the rules of the DMA and would face a fine of up to 5 per cent of its global daily turnover per day for non-compliance – that would amount to a fine of around A$75.72 million per day.

App store

The EU is said to found that Apple failed to allow developers to promote their alternative offerings without imposing fees.

Even if the Apple manages to escape from the latest media reports of the EU’s findings are true, it doesn’t imply that Apple will be immediately fined. Instead, it could be offered the chance to correct its course and then allow the EU to reconsider its decision of whether a fine is still warranted.

Apart from this investigation, the DMA could throw up other problems for Apple. For example, in April Margrethe Vestager, Executive Vice-President of the European Commission for a Europe fit for the Digital Age, observed that the latest rules of the DMA could compel Apple to allow users to delete the Photos app on the iPhones, should they wish to do so.

She noted that Apple has failed to make several apps un-installable (one of them would be Photos) and prevents end-users from changing their default status (for example Cloud), as required by the DMA.

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