Report from Courthouse News Service
In Brief – The EU General Court dismissed Apple’s challenge to its designation as a “gatekeeper” under the Digital Markets Act (DMA). The ruling leaves intact the European Commission’s 2023 decision that Apple is a gatekeeper, and that iOS, Safari and the App Store are core platform services subject to the DMA’s stricter obligations, including requirements to increase interoperability with competitor services and devices. Although Apple’s complaint sought to overturn its gatekeeper designation, the iPhone giant primarily argued that the interoperability obligations that come with a gatekeeper designation violated its fundamental rights. The court ruled on procedural grounds that Apple and other gatekeepers cannot challenge DMA obligations like interoperability until the Commission adopts enforcement decisions applying those rules. As a result, Apple’s substantive objections to interoperability, which it argues threaten user privacy, security and innovation, remain unresolved and will be adjudicated in other cases.
Context – There are 7 gatekeepers operating 24 “core platform services” that must comply with the DMA’s 18 regulatory mandates, including the ability for third-party products and services to interoperate with the core platforms in the same manner as the gatekeeper’s own offerings. Interoperability is an especially difficult challenge to Apple’s core user proposition that it’s “walled garden” ecosystem provides a better and safer user experience. Apple’s restrictive model has been very popular in the EU but is basically now not legal. More than two years ago the Commission told the company how to give peripherals competitors, such as smart watches and headphones, full access to iPhone capabilities. Apple continues to strenuously object, arguing the rules harm the user experience and threatens user privacy. They are also withholding Siri AI from the EU, arguing that DMA rules would expose users to potentially unsafe third-party AI applications. The Commission is also pressing Google to give AI developers equal access to Android devices and Meta to give third-party chatbots equal access to WhatsApp.