The European Union has begun the process of outlining the steps to compel Apple to open up its iPhone and iPad operating systems to competing technologies under the bloc’s tough new Digital Markets Act.
Apple’s failure to comply could result in the company facing major fines – a scenario that it would want to avoid, having lost a €13 billion (A$21.55 billion) Irish tax bill earlier this month at the EU’s Court of Justice (ECJ) in Luxembourg.
This week, the European Commission has launched two so-called specification proceedings that will spell out what Apple has to do to abide by the DMA.
The first proceeding focuses on iOS connectivity features and functionalities, predominantly used for and by connected devices including smartwatches, headphones and virtual reality headsets. The EU said that companies offering these products depend on effective interoperability with smartphones and their operating systems, such as iOS. Hence, the Commission intends to specify how Apple will provide effective interoperability with functionalities such as notifications, device pairing and connectivity.
The second proceeding focuses on the process Apple has set up to address interoperability requests submitted by developers and third parties for iOS and iPadOS. The Commission points out that it is crucial “the request process is transparent, timely, and fair” so that all developers have an effective and predictable path to interoperability.
The Commission will conclude the proceedings within six months. During this period, it will communicate its preliminary findings to Apple. Also, a non-confidential summary of the preliminary findings and suggested measures will be published to enable third parties to provide comments.
While the move isn’t a formal probe, once the rules have been finalised, the EU could begin imposing steep fines against Apple for any breach of them.
The DMA stipulates that tech firms could be slapped with penalties equivalent to 10 per cent of their annual global turnovers.
“Today is the first time we use specification proceedings under the DMA to guide Apple towards effective compliance with its interoperability obligations through constructive dialogue,” said EU Executive Vice President Margrethe Vestager.
“We are focused on ensuring fair and open digital markets. Effective interoperability, for example with smartphones and their operating systems, plays an important role in this.”
Apple has indicated that while it will work with the Commission on adhering to the DMA, it has warned of risks. “At Apple, we’re proud of the fact that we’ve built over 250,000 APIs (application programming interfaces) that allow developers to build apps that access our operating system and functionalities in a way that ensures users’ privacy and security,” Apple said in a statement to The Post.
“To comply with the DMA, we’ve also created ways for apps in the European Union to request additional interoperability with iOS and iPadOS while protecting our users.”
Apple meanwhile has already taken steps specific to the EU to ensure its compatibility with the bloc’s regulations. Previously, Apple allowed steering only through “link-outs”, which permitted app developers to include a link in their app to redirect the customer to a web page.
Now, Apple has said developers can communicate and promote offers that are available anywhere, not just on their own website, from within their app. The company, however, has now introduced two new fees – an initial 5 per cent acquisition fee for new users and a 10 per cent store services fee for any sales made by app users on any platform within the 12 months of the app installation.
