Apple set to offer app store changes after €500 million fine

Apple Inc. is poised to offer further App Store changes to appease European Union antitrust watchdogs who issued an ultimatum after doling out a €500 million (R10.5 billion) fine.

The iPhone maker’s proposal - due by June 26 - would make it easier for third-party developers to direct customers away from the Apple ecosystem to make software purchases, according to people familiar with the matter, who spoke on condition of anonymity.

The pledge, following weeks of tense discussions with EU regulators, would potentially ward off future penalties for failing to fix alleged violations of the bloc’s Digital Markets Act, which led to the fine in April. Apple has said it plans to appeal the penalty through the bloc’s courts in Luxembourg.

The European Commission had been readying a formal charge sheet had the Cupertino-based company opted against filing a proposal by Thursday’s deadline. The Brussels-based commission and Apple declined to comment.

In April, both Apple and Meta Platforms Inc. were judged to have breached strict DMA rules that lay out a series of dos and don’ts for the world’s largest technology firms. Along with the Apple fine, Meta was slapped with a €200 million  (R4bn) penalty for its “pay or consent” ad-free service on Instagram and Facebook.

Apple responded fiercely to its penalty at the time, accusing the bloc’s regulators of discriminating against the company and forcing it to give away its technology for free. Just last year, the company was hit with a €1.8bn EU fine for shutting out music-streaming rivals on the iPhone.

Over recent years the EU has issued costly penalties against firms, including more than $8bn in fines against Alphabet’s Google and a separate order for Apple to pay Ireland back taxes of €13bn.

Under its abuse-of-dominance rules, it has also forced changes out of Amazon.com’s marketplace platform and Apple’s tap-and-go chip, while also investigating Microsoft Corp. video conference software, Teams.

The commission is also investigating Google’s adtech business and Teresa Ribera, the bloc’s antitrust chief, has said a potential divestment order is still on the table.

BLOOMBERG