Apple has a number of 'very serious' non-compliance issues with the European Union's new Digital Markets Act, according to Margrethe Vestager, the EU's competition chief.
Speaking to CNBC's Silvia Amaro in a wide-ranging interview in Brussels, Vestager expressed her surprise and disappointment, stating that such behavior was not what they had expected from Apple.
Here's an excerpt from the interview...
Silvia Amaro: "Recent reports are suggesting that the next one in the line under the DMA legislation is charging Apple. Can you comment on that?"
Margrethe Vestager: "Well, we have a number of Apple issues. I find them very serious. I was very surprised that we would have such suspicions of Apple being non-compliant. Of course, it remains to be seen, but they are very important because a lot of good business happens through the App Store, happens through payment mechanisms. So of course, even though I can say this is not what was expected of such a company, of course, we will enforce exactly with the same dedication and with the same top priority as with any other business."
Silvia Amaro: "Soon?"
Margrethe Vestager: "Hopefully soon."
Silvia Amaro: "The reason why I'm also bringing up Apple is because companies such as Spotify have also raised issues with the new changes that Apple has put forward. Ultimately the bill that they would face now is the same or even bigger than what was in place before. And this is why I want to bring up the issue again of whether the DMA is actually leading to ultimate changes for the big tech. Or are they still hiding here in between some of the, well, within the law?"
Margrethe Vestager: "Well I think that you cannot judge the DMA before we've had the cases and before we have finalized them. Because we have a toolbox of fines, of doubling fines, of potential break up of companies. So we have a very strong toolbox to punish. And now the investigations are ongoing. And one of the things we're looking at of course is that if a new set up of a fee structure is de facto preventing businesses from having the benefits of the digital markets act. And I think it is very telling that what we see is sort of businesses trying to evade what is 100% legitimate. It is European legislation. You have a good business here. Then you're supposed to live up to the legislation where you do your business. And I expected cases. I was a bit surprised that we would have so many cases so soon and more in the pipeline. But I think it comes from the fact that we're getting closer to the business model. And because of that, of course, also the potential for other businesses to be able to compete for that business is so much bigger. And that of course is very encouraging for someone who believes in competition."
There has been a strong backlash to Apple's 'compliance' with the DMA. Back in March, a group of thirty four companies and associations wrote to the EU expressing concerns that Apple has disregarded the spirit and letter of the Digital Markets Act. They accuse the company of failing to comply with new legislation and making a 'mockery of the DMA'. Additionally, the Coalition for App Fairness called Apple's effort to comply with the EU's Digital Markets App a 'shameless insult'.
Recent reports suggest that the EU will bring initial charges against Apple before the summer break in August, with more investigations still ongoing.
Take a look at the interview below and please download the iClarified app or follow iClarified on Twitter, Facebook, YouTube, and RSS for updates.
Speaking to CNBC's Silvia Amaro in a wide-ranging interview in Brussels, Vestager expressed her surprise and disappointment, stating that such behavior was not what they had expected from Apple.
Here's an excerpt from the interview...
Silvia Amaro: "Recent reports are suggesting that the next one in the line under the DMA legislation is charging Apple. Can you comment on that?"
Margrethe Vestager: "Well, we have a number of Apple issues. I find them very serious. I was very surprised that we would have such suspicions of Apple being non-compliant. Of course, it remains to be seen, but they are very important because a lot of good business happens through the App Store, happens through payment mechanisms. So of course, even though I can say this is not what was expected of such a company, of course, we will enforce exactly with the same dedication and with the same top priority as with any other business."
Silvia Amaro: "Soon?"
Margrethe Vestager: "Hopefully soon."
Silvia Amaro: "The reason why I'm also bringing up Apple is because companies such as Spotify have also raised issues with the new changes that Apple has put forward. Ultimately the bill that they would face now is the same or even bigger than what was in place before. And this is why I want to bring up the issue again of whether the DMA is actually leading to ultimate changes for the big tech. Or are they still hiding here in between some of the, well, within the law?"
Margrethe Vestager: "Well I think that you cannot judge the DMA before we've had the cases and before we have finalized them. Because we have a toolbox of fines, of doubling fines, of potential break up of companies. So we have a very strong toolbox to punish. And now the investigations are ongoing. And one of the things we're looking at of course is that if a new set up of a fee structure is de facto preventing businesses from having the benefits of the digital markets act. And I think it is very telling that what we see is sort of businesses trying to evade what is 100% legitimate. It is European legislation. You have a good business here. Then you're supposed to live up to the legislation where you do your business. And I expected cases. I was a bit surprised that we would have so many cases so soon and more in the pipeline. But I think it comes from the fact that we're getting closer to the business model. And because of that, of course, also the potential for other businesses to be able to compete for that business is so much bigger. And that of course is very encouraging for someone who believes in competition."
There has been a strong backlash to Apple's 'compliance' with the DMA. Back in March, a group of thirty four companies and associations wrote to the EU expressing concerns that Apple has disregarded the spirit and letter of the Digital Markets Act. They accuse the company of failing to comply with new legislation and making a 'mockery of the DMA'. Additionally, the Coalition for App Fairness called Apple's effort to comply with the EU's Digital Markets App a 'shameless insult'.
Recent reports suggest that the EU will bring initial charges against Apple before the summer break in August, with more investigations still ongoing.
Take a look at the interview below and please download the iClarified app or follow iClarified on Twitter, Facebook, YouTube, and RSS for updates.