Apple leads consultation challenges to Digital Markets Act

The European Commission ran a consultation on a review of the DMA and Apple highlighted some compliance and innovation impacts in its response and called for the DMA to be scrapped and replaced.

Apple and the Commission are preparing to face off in the courts over the iPhone firm’s alleged failure to comply with anti-steering provisions within the DMA, with Apple contesting a €500 million fine and also separately appealing specification requirements aimed at ensuring interoperability between their services and third party devices.

In response to the EU consultation, Apple called for the DMA to be scrapped entirely “while a more appropriate fit for purpose legislative instrument is put in place”.  It also expressed concerns over delays to innovation and product launches in the EU and impact on user experiences among other issues. Other stakeholders echoed similar concerns in their responses to the consultation, whilst also noting positive aspects of the regime.

Tadeusz Gielas, a competition law expert with Pinsent Masons, said the issues identified by Apple and other consultation respondents provided an opportunity to assess how the Commission’s application and enforcement of the EU digital markets competition regime could be refined.

“The DMA regime is still relatively new, the full range of DMA compliance obligations has only started to apply from March 2024 in respect of the ‘first wave’ of gatekeepers and their ‘core platform services’ that had been designated in September 2023,” he said.

“The determination of multiple appeals currently pending before the EU courts – involving Apple, other gatekeepers, and even an action brought by internet browser company Opera challenging a non-designation decision - is expected to provide valuable future guidance on how the commission should interpret and apply key aspects of the DMA, and provide important checks and balances on the Commission’s enforcement approach." 

Responses to the EU consultation come as the Competition and Markets Authority (CMA) in the UK prepares to publish its own final designation decisions on the technology firms to first be classified as having strategic market status (SMS) following the commencement of the UK’s own digital markets competition regime on 1 January 2025.

SMS-designated companies will face tailored “conduct requirements” drawn up by the CMA in respect of their “digital activity” in the UK. They will also be required to report qualifying anticipated M&A transactions to the CMA which may then request the SMS firm to submit a formal merger notification under the UK’s standard merger control regime.

While the European Commission is the sole enforcer of the DMA across the EU, concerns have also been raised over the risk of member states targeting companies with their own national competition rules in parallel.

“Geopolitics and international trade considerations will remain relevant too - even if indirectly - where competition regimes seek to regulate digital markets, given the potentially significant implications for technological innovation, business investment, and consumers, and often involving major US-based firms,” said Gielas.
"Key learnings that emerge from the DMA consultation in the EU may also provide useful pointers for the CMA on what pitfalls to avoid when the UK regime begins to fully apply to the first SMS firms that will soon be designated,” he said.