Apple Faces $38 Billion Fine Over App Store Practices - What We Know

Apple Faces $38 Billion Fine Over App Store Practices - What We Know

Apple's troubles with the EU are far from over, and the tech giant could be fined for violating the Digital Markets Act (DMA), according to sources contacted by Bloomberg, due to “anti-steering practices” that stifled competition in the App Store, Apple could be fined.

This would be the first company to be fined under the EU's new antitrust rules. Apparently, the fine is due to Apple's “failure to allow app developers to direct users to cheaper products and promotions outside of the App Store.”

This comes after the EU warned Apple about not providing developers with “effective means” to direct users away from the App Store. The company is also under investigation as to whether it is hindering attempts to launch an alternative app store in the region. However, the results of that investigation will not be known for some time.

It is not clear how much Apple is likely to be fined right now, but under EU rules, regulators have the power to impose fines of significant amounts. The amount could start at up to 10% of global sales and increase to 20% if the violation is repeated. Other fines can reach up to 5% of average daily sales.

Given that Apple's sales last year were $383 billion, this fine could be as high as $38 billion based on Apple's total sales last year. This is more than the 1.8 billion euros (about $1.93 billion) in total fines Apple previously received in the EU for abusing its power in the music streaming market. The fine, which was imposed under old competition laws, is another example of how Apple is not doing well in Europe.

It is not clear when Apple will be fined this fine, but Bloomberg reports that it could be imposed by the end of this month, when the current Competition Commissioner, Margrethe Vestager, is scheduled to step down. However, it could also be postponed to an unspecified point in the year, with “periodic penalty payments” that could accumulate until Apple complies with the law.

The decision is apparently still being drafted, so we will have to patiently wait and see what the fine will actually be over the next few months.

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