Apple pushes back against UK proposal to loosen App Store payment rules

Apple today alleged that a new UK proposal targeting App Store fees amounts to price regulation, warning that it could undermine innovation and investment. Here are the details.

Apple fights App Store regulation in the UK

As reported by Reuters, Apple today submitted a formal response to a consultation by the UK’s Competition and Markets Authority (CMA), pushing back against proposed rules that would allow app developers to link to alternative payment options.

The CMA can impose such requirements after designating Apple and Google as having “strategic market status” in their respective mobile platform markets last year. Under the UK’s new digital markets regime, that designation allows the regulator to introduce company-specific rules to promote competition and give consumers more choice.

Under the proposal, Apple and Google would still be allowed to charge developers a commission on purchases completed through alternative payment methods, but any such fee would have to be considered “fair and reasonable”.

Reuters notes that the CMA “expect(s) steering fees to be lower than current app store charges, with ​savings passed on to UK customers or reinvested into developers’ businesses to support innovation.”

Apple, however, sees it differently and is pushing back against the proposal. Here’s Reuters:

In a submission to Britain’s ‌Competition and Markets Authority, the iPhone maker said proposed “steering” requirements would go beyond promoting competition and give the regulator a “highly intrusive” role in managing its business.

And

“Under the (consultation), the CMA would not only regulate Apple’s prices, but also restrict the products ​and services for which ​Apple can charge a ⁠commission,” the company said in its submission.

The CMA rejected Apple’s characterization of the proposal as price regulation, saying it intends to establish principles for determining whether steering fees are fair and reasonable rather than setting those fees directly.

To read Reuters’ full report, follow this link.

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