Italy fines Apple $115M over App Store practices and privacy rules

Italy’s competition authority has imposed a €98.6 million fine on Apple, intensifying scrutiny over how the company operates its App Store and applies privacy rules to developers.

The decision adds to a broader European debate on whether Apple’s control over its mobile ecosystem disadvantages third-party app makers, even as the company argues that its policies are designed to protect user privacy.

The case centres on how Apple applies its App Tracking Transparency framework and whether those requirements comply with European competition and privacy rules.

Italy’s competition watchdog, the Autorità Garante della Concorrenza e del Mercato, known as AGCM, said on Monday that it fined Apple and two of its divisions €98.6 million, equivalent to about $115.53 million.

The authority concluded that Apple abused its dominant position in the mobile app market through practices linked to the App Store.

App Store dominance concerns

AGCM said Apple holds absolute dominance in its dealings with third-party developers that depend on the App Store to reach users of iPhones and iPads.

According to the authority, this position allows Apple to take unilateral decisions that can significantly affect competition and the business conditions faced by developers.

The watchdog said Apple’s control over the App Store creates an imbalance, particularly when new policies are introduced without negotiation or meaningful alternatives for developers.

In this case, AGCM said it focused on how Apple applied privacy-related rules to third-party apps, while retaining a different degree of flexibility for its own services within the same ecosystem.

Privacy rules under scrutiny

The investigation, opened in May 2023, examined changes introduced from April 2021, when Apple rolled out its App Tracking Transparency framework.

AGCM said Apple penalised third-party developers by requiring them to adopt a more restrictive privacy policy than before.

Under ATT, developers must obtain explicit user consent before collecting data or linking data for advertising purposes.

AGCM said this consent had to be requested through a screen designed by Apple, which the company made mandatory.

The authority said the terms of the ATT policy were imposed unilaterally, harmed the interests of Apple’s business partners, and were not proportionate to the stated aim of protecting privacy.

It also said the process did not comply with applicable privacy regulations, states Reuters.

AGCM added that developers were required to duplicate consent requests for the same purpose, increasing friction for users and potentially disadvantaging third-party apps compared with Apple’s own services.

Apple response and appeal

Apple said it strongly disagreed with the decision, as per a Reuters report.

The company said the ruling disregards the privacy protections delivered through App Tracking Transparency.

Apple said the framework was created to give users a simple and clear way to control whether companies can track their activity across other apps and websites.

The company said the same rules apply to all developers, including Apple itself, and that ATT reflects its broader commitment to user privacy.

Apple said it will appeal the decision and continue to defend what it describes as strong privacy protections.

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