Competition watchdog closes Apple and Google probes ahead of rules shake-up

The UK’s competition watchdog has closed investigations into Apple and Google’s app stores ahead of the rollout of new digital markets laws, but warned the firms could face fresh scrutiny under the new rules.

The Competition and Markets Authority (CMA) said it was closing its existing cases involving the tech giants ahead of a new regime coming into force as part of the Digital Markets, Competition and Consumers Act (DMCCA), which passed into law in May.

Under the new rules, firms can be designated as having “strategic market status” in connection with any digital activities in the mobile sector and have requirements placed on their conduct by the CMA, with significant fines if those requirements are breached.

The CMA said the new rules would enable it to consider issues raised more “holistically” than under the existing Competition Act rules.

“Once the new pro-competition digital markets regime comes into force, we’ll be able to consider applying those new powers to concerns we have already identified through our existing work,” CMA executive director for digital markets, Will Hayter, said.

“It’s critical that tech businesses in the UK, including app developers, can have access to a fair and competitive app ecosystem, helping to grow the sector, boost investment and result in better outcomes for UK consumers.

“These are all factors we are considering before launching our first investigations under the new regime.”

Earlier this year, the CMA said it expected to launch three or four new investigations within the first year of the new digital markets competition regime coming into force – which is expected later this year.

The now closed CMA investigations had been looking into concerns that Google and Apple were exploiting the dominant market positions of their respective Google Play and App Store platforms to set unfair terms for app developers and therefore restricting competition and consumer choice.

The cases focused in particular on rules which require app developers to use the tech giants’ own billing systems.

The regulator said those cases were closed on the grounds of administrative priorities and had not taken any decisions on whether the Competition Act had been infringed.

Apple has recently begun loosening some of the controls around its App Store and iOS operating system in the EU because of the introduction of similar new digital markets and competition legislation in Europe.

In addition to the announcement around the existing investigations, the CMA confirmed it had rejected a set of proposed commitments submitted by Google in response to the regulator’s concerns around its Play Store billing system.

The CMA said feedback it had received on the proposed changes still raised concerns about the level of commission that would have to be paid to Google by developers, as well as concerns about new pop-up screens putting off users from using alternative payment systems.