Tag: ACM

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Apple’s payment options offer for Dutch dating apps is compliant, says ACM

The Netherlands’ competition regulator is finally happy with concessions by Apple to allow dating apps in the market to use alternative payment technologies.

Late Friday, the Authority for Consumers and Markets (ACM) provided an update on the multi-month saga which has drawn high level attention on Apple’s approach to complying with competition orders, saying the tech giant had changed unfair conditions it had been imposing following an order by the regulator to allow dating apps to use non-Apple payment tech for processing in-app purchases.

“Until recently, customers of dating apps had only been able to pay using the payment method that Apple imposed. In ACM’s opinion, Apple abused its dominant position with those practices,” the ACM wrote in the update. “From now on, dating-app providers are able to let their customers pay in different ways.”

The ACM has hit Apple with a series of fines since January — totalling €50 million — for non-compliance with its order, and had warned it could issue further penalties if Apple did not resolve its concerns.

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The watchdog had been considering a revised offer Apple made back in March — after finding problems with how Apple had implemented earlier concessions and judging conditions it applied to be “unreasonable“, as well as accusing it of creating an “unnecessary barrier” for developers of dating apps.

“Apple now complies with the rules,” the regulator added. “That is why ACM no longer needs to impose a new order subject to periodic penalty payments. Over the past few months, ACM had collected information from dating-app providers and independent experts before its assessment that Apple complied with the order.”

Commenting in a statement, Martijn Snoep, chairman of the ACM’s board, also said: “We want everyone to be able to reap the benefits of the digital economy. In the digital economy, powerful companies have a special responsibility to keep the market fair and open. Apple avoided that responsibility, and abused its dominant position vis-à-vis dating-app providers. We are glad that Apple has finally brought its conditions in line with European and Dutch competition rules. That offers app providers more opportunities to compete. And consumers will ultimately reap the benefits, too.”

Details of how exactly Apple revised its concession to satisfy the ACM are not immediately clear — but, among a number of tweaks to its original offer, Apple previously dropped a requirement that dating apps compile a separate binary which the regulator had deemed overly burdensome.

In documentation for developers distributing dating apps in the Netherlands, Apple confirms they may do one of the following:

  1. continue using Apple’s in-app purchase system,
  2. use a third-party payment system within the app,
  3. include an in-app link directing users to the developer’s website to complete a purchase, or
  4. use a third-party payment system within the app and include a link directing users to the developer’s website to complete a purchase.

“Developers of dating apps who want to continue using Apple’s in-app purchase system may do so and no further action is needed. Those who want to use a different payment system will need to request the StoreKit External Purchase Entitlement or the StoreKit External Purchase Link Entitlement, or both,” Apple also writes.

“The entitlements that comply with the ACM order are only available for dating apps on the App Store in the Netherlands, and apps distributed pursuant to those entitlements must only be used in an iOS and/or iPadOS app on the Netherlands storefront. Apple will review each dating app submitted to ensure it complies with the terms and conditions of the entitlement, as well as the App Store Review Guidelines and the Apple Developer Program License Agreement,” it adds.

The ACM’s original order to Apple dates back to August 2021 but full details have still not been released as they remain under court seal following legal action by Apple — which filed an objection to the order and succeeded in suspending part of it until after that (ongoing) objection procedure against the full order is completed. Although the court allowed the ACM to publish a portion of the decision and levvy periodic penalty payments against Apple for non-compliance.

Apple was contacted for comment.

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Match Group Google Play Store complaint triggers Dutch antitrust probe

A competition complaint against Google’s Android Play Store by Match Group, the company which owns Tinder and a number of other dating apps, has led to a preliminary investigation by the Netherlands’ Authority for Consumers and Markets (ACM) into whether the tech giant is abusing a dominant position, the regulator said today.

Match Group declined to comment on the substance of its complaint — but the ACM confirmed it has received “a request for enforcement regarding the Google Play Store.”

“Dating-app providers allegedly are no longer able to use a payment system other than Google’s payment system. In addition, dating apps claim they are no longer allowed to refer to other payment methods either,” the ACM also said in a short press statement.

“Dating-app provider [Match Group] has asked ACM to assess whether Google abuses its dominant position with these practices. ACM will therefore conduct a preliminary investigation in response to this request.”

The regulator declined to answer questions about the complaint.

In its own statement, a Google spokesperson told us:

Like any business, Google charges for services but Match Group’s apps are eligible to pay just 15% on Google Play for digital subscriptions, which is the lowest rate among major app platforms. But even if they don’t want to comply with Google Play’s policies, Android still provides them multiple ways of distributing their apps to Android users, including through other Android app stores, directly to users via their website or as consumption-only apps.

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The ACM has been locked in a lengthy battle with iOS maker Apple over its app store payment rules as applied to local dating apps — which led it to order that Apple must allow dating apps to use alternative payment processing services and issue a series of fines as the regulator judged Apple had failed to comply with the order.

The fines hit the maximum allowed for by an associated court order by the end of March — €50 million — when the ACM said it was considering a revised offer by Apple. However, according to Reuters, the regulator has decided Apple’s offer still does not comply with its order and it reports being told on Monday that the ACM is preparing a new order with new penalty payments.

The enforcement tug of war between the ACM and Apple attracted high level attention from the European Commission, with EVP Margrethe Vestager hitting out at Apple for deliberating choosing to pay a fine rather than comply in remarks back in February.

That’s notable because the Commission itself will in charge of enforcing a new ex ante competition regime against the most powerful tech giants which is due to come into force across the EU later this year.

The bloc’s lawmakers agreed the final details of the Digital Markets Act (DMA) in March — cementing a regime that will enforce a set of operational rules on so-called “internet gatekeepers” which look set to shrink Apple’s and Google’s ability to micromanage how business users must operate on their app stores.

Under the incoming pan-EU regulation, fines can scale up to 10% of global annual turnover for gatekeeper non-compliance with the regulation’s up-front obligations. That means DMA enforcements are both likely to flow faster and be harder for Big Tech to ignore than traditional ‘ex post’ competition interventions.

Apple’s fine over Dutch dating apps antitrust order hits €50M — but ACM welcomes revised offer

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Apple’s tweaked antitrust offer drops separate binary requirement for Dutch dating apps

Apple has dropped a requirement for a separate binary which it had sought to impose on Dutch dating apps wanting to take up a legal entitlement to use non-Apple payment tech to process their in-app purchases.

Previously the company had argued that a separate binary was a “straightforward prerequisite” which did not impede its claimed compliance with the ACM’s antitrust order. (The Dutch regulator continued to disagree, however.)

In an update on “StoreKit External Entitlement for dating apps” posted to Apple’s developer site yesterday, the company said it had removed the requirement that developers of dating apps in the Netherlands who choose to use the entitlements must create and use a separate binary.

“This change means that developers may include either entitlement in their existing dating app but still must limit its use to the app in the Netherlands storefront and on devices running iOS or iPadOS,” Apple noted.

Additional tweaks Apple also said it had made yesterday are to payment service provider criteria — with the tech giant saying it is providing “updated and more-specific criteria to evaluate non-Apple payment service providers that developers of dating apps in the Netherlands may use” — as well as changes in the area of consumer disclosure.

On the latter Apple had added a requirement that Dutch dating app developers making use of the entitlements need to display an in-app notification to users explaining that they’re going to make purchases through an external payment system — “and the potential impact that choice could have on the user”, as Apple’s update blandly puts it.

The company writes that it is “adjusting the language on the modal sheet and reducing the number of times the sheet must be displayed” — so it looks relatively safe to assume that the original notification had been worded in such a way as to be deemed too scary/off-putting to users, making it less likely they’d go through with an ‘off-platform’ payment in the first place.

(Apple has been criticized along those lines for other types of notifications it bakes into iOS — such as when users want to give full permission to third keyboards to run on the platform, for example.)

Throughout this saga, the ACM has called out Apple for creating unreasonable friction for the developers in question — leading to a string of fines for non-compliance since January: Ten €5M fines in all, reaching a (current) total of €50M.

Apple and the ACM were contacted with questions on the development.

Apple’s fine over Dutch dating apps antitrust order hits €50M — but ACM welcomes revised offer

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Apple sends new offer to Dutch antitrust authority over dating apps payments, racks up 9th fine

Apple has been fined again in the Netherlands over an antitrust order related to dating apps. The order requires it to allow local dating apps to be able to use third-party payment technologies if their developers wish, rather than being locked to only being able to use Apple’s in-app payment API for iOS.

Since January, the Authority for Consumers and Markets (ACM) has levied a series of (weekly) penalties against Apple for what it asserts is continued non-compliance with the order.

The latest €5 million fine (the ninth) brings the total penalties against Apple on this issue up to €45 million (out of a maximum possible of €50 million if it again fails to satisfy the regulator by next week).

Apple has responded to the string of fines over this period by claimed it is complying with the order — despite the regulator clearly taking a different (opposite) view.

Apple fined again for applying ‘unreasonable’ conditions to dating apps after Dutch antitrust order

The ACM has variously described Apple’s response as disappointing and unreasonable — accusing it of creating an unnecessary barrier for developers who want to take up the legal entitlements to use non-Apple payment tech to process in-app payments, rather than simply letting them easily choose to do so.

The tussle has gone on for weeks but, despite yet another penalty now, there may be sign of a shift by Apple: Per the ACM, Apple submitted “new proposals” earlier today — which it said it’s studying to determine whether they pass muster or not.

“We will now assess the substance of these proposals,” said an ACM spokesperson in a statement. “In that context, we will also sit down with various market participants. Our aim is to complete this assessment as soon as possible.”

The ACM has not disclosed details of what Apple is proposing in this amended compliance offer. (And the regulator did not respond to requests for more detail.)

“It should be noted that, until last weekend, Apple still had not met ACM’s requirements,” its spokesperson added. “That is why it has to pay a ninth penalty payment, which means the total amount that Apple must pay currently stands at €45 million euros.”

Apple was also contacted for comment on the development but at the time of writing the company had not responded. Update: Apple declined comment.

While the ACM’s antitrust order applies only in the Netherlands, and only to a subset of apps (dating apps) — so it may look like rather small fry in the grand, global scheme of Big Tech — the tug-of-war between a national regulator and a platform giant has attracted high-level attention in the European Union, which suggests the enforcement is been closely watched by policymakers at a time when they are simultaneously hammering out the final details of a major competition overhaul.

The EU is in the process of finalizing a long-trailed, ex ante reform of digital competition policy (called the Digital Markets Act; aka, the DMA) — which will apply exclusively to the most powerful intermediating Internet platforms.

This is relevant because Apple is almost certain to be designated a “gatekeeper” under the DMA — which will bring in a proactive regime of antitrust compliance that’s intended to make digital markets more open and contestable, such as by banning platforms from cross-tying applications or enforcing lock-ins, as well as simultaneously obliging them to support interoperability and enable service switching. So that means Apple is likely to face similar (and, indeed, far broader) pan-EU antitrust orders in the future, which will stipulate how it must (and must not) act vis-à-vis third parties.

EU commissioner Margrethe Vestager, who both heads up the bloc’s antitrust division and leads its digital policymaking, raised the Dutch case specifically in a speech last month — accusing Apple of “essentially” preferring to pay periodic fines rather than comply with a competition ruling it does not agree with. She also warned that obligations related to third party access for Apple’s App Store “will… be one of the obligations included in the DMA”.

The incoming pan-EU law will have serious teeth: With fines of up to 10% of annual global turnover and the potential for the bloc to respond to systematic rule flouting by imposing a structural remedy which orders a gatekeeper to be broken up.

So, for tech giants set to be subject to the DMA, the “comply vs deny” calculus — that’s only possible when a penalty can be written off as a “cost of doing business” — looks set for a radical rebalancing under the rebooted EU competition regime. And where €5 million — or even €50 million — doesn’t move the operational needle, a penalty that could scale to several billions — backed up by a risk that continued dancing around legal requirements might force regulators to reach for their break up hammers — looks like a whole different kettle of compliance fish.

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