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ACM: Apple changes unfair conditions, allows alternative payments methods in dating apps

Apple has changed its unfair conditions, and will now allow different methods of payment in Dutch dating apps. With this concession, Apple will meet the requirements that the Netherlands Authority for Consumers and Markets (ACM) set under European and Dutch competition rules. Until recently, customers of dating apps had only been able to pay using the payment method that Apple imposed. In ACM’s opinion, Apple abused its dominant position with those practices. From now on, dating-app providers are able to let their customers pay in different ways. ACM forced these changes by imposing an order subject to periodic penalty payments. In the end, the sum of all penalty payments totaled 50 million euros.

Martijn Snoep, Chairman of the Board of ACM, explains: “We want everyone to be able to reap the benefits of the digital economy. In the digital economy, powerful companies have a special responsibility to keep the market fair and open. Apple avoided that responsibility, and abused its dominant position vis-à-vis dating-app providers. We are glad that Apple has finally brought its conditions in line with European and Dutch competition rules. That offers app providers more opportunities to compete. And consumers will ultimately reap the benefits, too.”

Speaker: Martijn Snoep, chairman of the Netherlands Authority for Consumers and Markets

MARTIJN SNOEP: The problem that ACM has addressed is that big companies in the digital economy enjoy a dominant position. Such a position calls for special responsibilities. One such company, Apple, abused its position by requiring dating app providers to use Apple's own payment systems. After much insistence they eventually adjusted their conditions, so that dating app providers are now able to implement their own payment systems in their dating apps and they're no longer dependent on Apple. The digital economy offers many opportunities, but there are dangers as well, and we try to navigate those in such a way that, on the one hand, companies and people have the opportunity to innovate and seize new opportunities but that, on the other hand, there is enough room for competition and that consumers are not misled.

VISUAL: Logo the Netherlands Authority for Consumers and Markets
VISUAL TEXT: Markets that work well for people and businesses

What was this case about?

Dating-app providers must be allowed to choose a method of payment in their apps and to have the ability to refer customers to their own websites for payment. Dating-app providers cannot be forced to use Apple’s payment method or else be barred from the App Store. That is not allowed under European and Dutch competition rules. Abuse of dominance drives up the price, reduces the quality of products and services, and restricts innovation.

Background

In August 2021, ACM imposed an order subject to periodic penalty payments on Apple. Apple filed an objection against this order. At the same time, Apple asked the court to suspend the order as well as publication of ACM’s decision. The part of the order that is relevant here was upheld by the court in December 2021, which meant that ACM was allows to publish that part of the decision. The other part of the order was suspended by the court until after the objection process, and ACM cannot publish this part. It then took a while before Apple finally complied with the cleared part of the order. In January 2022, the periodic penalty payments started to kick in, and went up to the maximum of 50 million euros. That is why Apple must pay a total penalty of 50 million euros. Apple now complies with the rules. That is why ACM no longer needs to impose a new order subject to periodic penalty payments. Over the past few months, ACM had collected information from dating-app providers and independent experts before its assessment that Apple complied with the order.

The procedure regarding the objection against ACM’s full order is still ongoing.

ACM and the digital economy

The digital economy is a key topic on ACM’s Agenda. People and businesses must be protected against online misleading practices and market power. In order to tackle abuses of dominant positions, ACM conducts investigations, and is able to impose sanctions on businesses, including fines and orders subject to periodic penalty payments. In addition to competition rules, the new European rules such as the Digital Markets Act will also help ACM deal with Big Tech companies. For example, major companies and platforms must grant access to their platforms or technologies. Also, ACM has published its ‘Guidelines on the protection of the online consumer’. These guidelines have been based on European consumer protection rules, and explain at what point online persuasion turns into deception. These guidelines form the basis for investigations and enforcement actions by ACM. In that way, ACM ensures that online markets, too, work well for people and businesses.