The UK's Competition and Market Authority (CMA) today announced it had closed an investigation into Apple's App Store policies, as it expects to consider the concerns under a new digital markets competition regime which is expected to come into force later this year.
Originally initiated in March 2021, the CMA's investigation set out to determine whether or not Apple has a dominant position in connection with the distribution of apps on Apple devices in the UK – and, if so, whether Apple imposes unfair or anti-competitive terms on developers using the App Store, such as by charging a 30% commission on transactions.
The watchdog opened a similar probe into Google, which it believed breached UK competition law by making app developers use its own billing system for in-app purchases. The CMA now says it has closed the Competition Act cases into Google's Play Store and Apple's App Store on the grounds of administrative priorities and has not taken any decisions as to whether the Competition Act 1998 has been infringed.
Despite both investigations being closed, the competition regulator says it may use new powers given to it via the UK's new Digital Markets, Competition and Consumers Act to address its concerns "more holistically" with a view to boosting competition in the app market. From the CMA's press release:
In light of recent developments, in particular the passing in May of the Digital Markets, Competition and Consumers Act (DMCCA), the CMA has assessed its existing Competition Act investigation into Google's Play Store and its parallel case into Apple's App Store rules against its administrative priorities and decided to close these cases at this point. Should Apple or Google each or both be designated as having 'strategic market status' in connection with any digital activities in the mobile sector, the CMA will be able to use its new powers to consider the range of issues raised by parties more holistically than it otherwise could under these specific Competition Act investigations. This will also enable the CMA to consider what, if any, interventions may be needed following any designation.
Published in January 2024, the new digital markets competition regime paper gives the CMA the ability to impose requirements on the conduct of firms in digital markets where those firms have been designated as having Strategic Market Status (SMS) – and to impose significant fines against firms if those requirements are breached.
In that paper, the CMA also confirmed it expects to launch around three to four SMS investigations within the first year of the new digital markets competition regime coming into force, which is expected later this year.
