The drip in fines for Apple in the Netherlands after an antitrust order over payment technology for dating apps reached the maximum possible (for now) – reaching 50 million euros (~ $55 million) after the regulator issued a tenth consecutive weekly penalty of €5 million for persistent non-compliance.
But the Authority for Consumers and Markets (ACM) looks more positive today after Apple adjusted its most recent offer yesterday – saying the amended proposal “should result in final terms for app providers to met”.
Once it receives all the details, the regulator said it will seek market comment and issue a decision on whether the proposal is acceptable as soon as possible. Although he did not provide any indication of the duration of this evaluation, nor any details on the modified proposal itself. And he also warns that Apple could still face further penalties if the revised offer is still found to be unacceptable. The saga, which has already lasted several months, may therefore not yet be over.
Previous offers from Apple have been rejected by the ACM as creating unreasonable friction for the developers in question.
In a statement released today, the Dutch regulator said: “ACM welcomes Apple’s current move. The adjusted proposal is expected to result in final terms for dating app providers who want to use the App Store. Upon receipt of the proposal for final terms, ACM will submit it to market participants for consultation. ACM will then render its decision as soon as possible whether Apple, when implementing these final terms, complies with ACM’s requirement that alternative payment methods must be possible in dating applications.
“Until last weekend, Apple had still not met ACM’s requirements. This is why he has to pay a tenth penalty payment, which means that Apple has to pay the maximum fine of 50 million euros,” he added. If ACM comes to the conclusion that Apple does not meet the requirements, ACM may impose another order subject to periodic penalty payments (with potentially higher penalties this time) to induce Apple to comply with the ordered.
Apple has been contacted for a response.
The public tussle over the ACM-ordered legal right for local dating apps to use non-Apple-based payment technology to process in-app digital content sales if they choose has been going on since January – although the ACM’s order dates back to last year (but a legal challenge by Apple limited the public release of it until later).
Although the case may seem ridiculously narrow – a subset of applications within a small European market, where the ACM has the power to issue such orders – an ongoing reform of pan-European digital competition law, aka the Digital Markets Act (DMA), is set to reconfigure how the most powerful platforms will be able to operate across the bloc in the near future by setting initial standards of conduct in areas such as FRAND terms for business users, incorporating interoperability requirements and prohibiting anti-competitive practices such as self-preference, among other do’s and don’ts for access control giants.
Thus, the ACM command offers a microcosmic glimpse of the larger demands of the EU to come.
It is very likely that the DMA will apply to the Apple App Store. This is why the Dutch case has generated high-level interest within the EU, not least because the spat signals the massive challenge the Commission will face in activating ex ante monitoring of control platforms access, probably from this fall. (Last week, the EU institutions politically agreed on the details of the DMA – but formal adoption is still pending.)
Under the market reform, the scale of the penalties the Commission will be able to impose is considerably larger – up to 20% of annual worldwide turnover in the event of repeated breaches – so the regime seems much harder for platform giants to ignore.
Another key change is that the DMA will be proactive, setting an expectation of compliance upfront rather than the EU competition regulator having to spend months or even years proving non-compliance before it can order changes.