April 18. 2024. 11:48

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Apple fights back against German competition control regime


The German competition authority on Wednesday (April 5) added Apple to its ‘special watch’ list, joining the other Big Tech companies. However, the iPhone maker already announced it will legally challenge the decision.

The German antitrust regulator, the Bundeskartellamt, decided that Apple is a company of paramount significance for competition across several markets, meaning that the authority can now prohibit the company from engaging in what are deemed anti-competitive practices.

With today’s decision, Apple is the fourth Big Tech company to join the special abuse control regime. Previously, the Bundeskartellamt designated Google’s Alphabet, Facebook’s Meta, and Amazon.

The specific competition regulatory framework is set out under section 19a of the German Competition Act (GWB), which allows the national antitrust watchdog to prevent digital giants from implementing anti-competitive practices. Technology companies must exhibit significant market power across a range of digital markets to be found valid.

“With its proprietary products iOS and the App Store, Apple holds a key position for competition as well as for gaining access to the ecosystem and Apple customers,” explains Andreas Mundt, President of the Bundeskartellamt.

Microsoft set to join Germany’s special watch competition regime

The German competition authority Bundeskartellamt took the initiative on Tuesday (March 28) to examine whether Microsoft is of paramount significance for competition across markets.

Apple’s position

The decision against Apple comes a week after the German antitrust body launched an initiative against Microsoft to examine whether the company is also subject to the special abuse control regime that is now applicable to Apple.

The Bundeskartellamt is additionally examining Apple’s tracking rules and the App Tracking Transparency Framework to assess whether the company impedes other firms.

In response, the iPhone maker said that it considers the decision to be disproportionate and announced that it will follow Amazon in appealing the designation.

“The designation misrepresents the fierce competition Apple faces in Germany, and it discounts the value of a business model that puts user privacy and security at its core,” explained an Apple spokesperson.

German competition body set to mandate Google to change data use terms

Germany’s competition authority, the Bundeskartellamt, issued a statement of objections to Google over the company’s data processing terms, which the watchdog ruled must be changed.

Background

Apple is among the top-selling and most profitable companies globally, exhibiting a turnover of 400 billion USD and a profit of almost 100 billion USD in the business year 2022. Most of the turnover is gained from the sales of Apple’s iPhone, which generates more than 50% of it.

Apple also occupies a complex ecosystem, which includes service products, the value chain of mobile digital end devices, the production of processors, the development of its own software iOS, and its distribution platform, the App Store.

The German antitrust watchdog associates Apple’s strong power to set rules for third parties, especially for app developers, based on its activity in many ways on market levels and business areas. Thereby, Apple is seen as capable to tie users on a long-term basis to its complex ecosystem.

German competition authority tightens its grip on Meta

Stricter antitrust measures can be taken against US giant Meta, Germany’s Bundeskartellamt announced on Wednesday (4 May), after similar measures were taken toward Google. Meanwhile, Germany is lobbying for stricter EU competition rules.