Apple is subject to “extended abuse control” under the German Competition Act, according to a statement released today by the Bundeskartellamt (Federal Cartel Office, or FCO), which implies that German authorities may forbid the business from engaging in “anti-competitive acts.”
According to FCO President Andreas Mundt, German authorities have the authority to intervene because Apple’s economic position needs to be regulated by competition.
Because of its economic clout across markets, Apple has various options that must be adequately restrained by competition. Apple has a vast digital ecosystem based on its mobile ends products, such as the iPhone, which is crucial to competition in Germany, Europe, and the rest of the world. Apple maintains a significant position for competition and acquiring access to the ecosystem and Apple users thanks to its products, iOS, and the App Store. With the help of this choice, we can effectively combat and outlaw anti-competitive behavior.
The FCO claims in the press release that Apple’s active install base of two billion devices provides it “great authority” to impose regulations on other parties, with Apple retaining control over users and customer access. With its riches and “position of power,” Apple is subject to those above “special abuse control.” For five years, this designation is valid.
German regulators are already investigating Apple’s guidelines for ad tracking and App Tracking Transparency, which demands that apps obtain users’ express approval before tracking them. To ascertain if Apple’s anti-tracking technology is anti-competitive, an investigation was launched in 2022.
The FCO has yet to determine whether to bring more legal action against Apple. These regulations previously bound Amazon, Meta/Facebook, and Alphabet/Google. The FCO now has the authority to “intervene early and more effectively” to stop major digital corporations from engaging in anti-competitive behavior, according to a 2021 change to the German Competition Act.
Apple stated that it intends to appeal the ruling and disagrees with several of the arguments made to qualify the business as being in a position of power.
Apple is happy to catalyze competition, employment growth, and innovation in every area we compete. The FCO’s categorization is a misrepresentation of the intense rivalry Apple faces in Germany. It minimizes the benefits of a corporate strategy that prioritizes user security and privacy. We want to challenge the FCO’s judgment even as we continue to work with them to comprehend their issues.
Apple said that the decision is not based on Apple’s genuine competitive relevance and that the FCO must provide a fair picture of the German hardware industry. Apple asserts that the iPhone and iPad are not locked into the Apple ecosystem but instead prefer to utilize Apple products because of consumer loyalty, in contrast to the FCO’s accusations that Apple’s environment limits user choice.
