Germany's antitrust authority confirmed that Apple meets its special abuse controls test, which it calls "overriding importance to competition in all markets." The designation lasts for five years.
“The company has a dominant, or at least powerful, position at all vertically related levels based on its smartphones, tablets and smartwatches, as well as its proprietary operating systems and the App Store, the only digital distribution platform of applications and other software products available. for both app publishers and Apple device users,” he wrote in a Press release.
“Based on this tight proprietary vertical structure and an installed base of more than 2 billion active devices worldwide, Apple is active in many ways at market levels and business areas that are linked to each other and therefore it is in a position to link its users to its complex ecosystem for the long term. This is associated with strong rule-setting power for third parties, especially app developers.”
It is the latest designation from the Federal Cartel Office (FCO) that has already considered that Amazon, Google and Meta (Facebook) meet the market power test. Late last month, it also opened an investigation into Microsoft's competitive power, which is ongoing.
The country passed the update to its national competition regime in 2021, with the aim of ensuring that the federal regulator is empowered to address Big Tech's market power, meaning it is ahead of the incoming pan-European principle (the Law on Digital Markets) which will see the European Commission appointing so-called "gatekeepers" of the internet and applying a set of initial operating rules to their businesses too, later this year.
Commenting on his Apple decision in a statement, Andreas Mundt, Chairman of the Bundeskartellamt, added:
Apple has a powerful economic position in the markets that gives rise to a field of action that is not sufficiently controlled by the competition. On the basis of its mobile devices such as the iPhone, Apple operates a powerful digital ecosystem that is of great importance to the competition not only in Germany, but also throughout Europe and the world. With its proprietary iOS and App Store products, Apple occupies a key position to compete as well as gain access to Apple's ecosystem and customers. This decision allows us to take specific action against anti-competitive practices and effectively prohibit them.
The designation means the FCO can act more quickly if it detects competition concerns arising from the way Apple operates its platforms and products.
Last year, the regulator opened an investigation into Apple's tracking rules and its App Tracking Transparency (ATT) framework, which governs tracking permissions for third-party apps running on iOS. The FCO said it is investigating an initial suspicion that these rules could favor Apple's own offerings and/or impede others.
"So far, no decision has been made on initiating further proceedings against Apple," it said in a statement. release.
Apple was contacted for comment on the FCO's decision to which an Apple spokesperson sent this statement, confirming that it plans to appeal:
Apple prides itself on being a driver of innovation, job creation and competition in every market in which we do business. The FCO designation misrepresents the fierce competition Apple faces in Germany and dismisses the value of a business model that puts user privacy and security at its core. While we will continue to work with the FCO to understand your concerns, we plan to appeal their decision.
