Apple loses challenges against EU rules to curb Big Tech

By Foo Yun Chee

BRUSSELS, July 8 (Reuters) - Apple lost its challenge on Wednesday against landmark EU rules that designate its app stores and operating system iOS as gatekeepers subject to obligations aimed at giving rivals more room to compete.

The EU Digital Markets Act, which sets out a list of dos and don'ts for Big Tech with the threat of fines of as much as 10% of a company's global annual turnover, has triggered legal challenges by Apple, Meta and ByteDance since it took effect in May 2023.

The ruling by the Luxembourg-based General Court will strengthen the position of EU antitrust regulators as they attempt to make space for rivals and give Europeans more choice.

"The General Court dismisses Apple's actions regarding its designation as a gatekeeper in relation to the App Store and iOS," the tribunal said.

It also said that Apple's actions regarding the iMessage service are inadmissible.

APPLE SAYS DMA THREATENS TO ERODE PRIVACY PROTECTIONS

Apple reiterated its criticism of the DMA.

"We firmly believe the DMA's mandate goes beyond what is lawful and proportionate, threatening to erode decades of privacy and security protections we've built and leaving our users vulnerable to new risks," an Apple spokesperson said.

"We will continue advocating for the innovation and privacy our European customers deserve."

Apple can appeal on matters of law to the Court of Justice of the European Union, Europe's highest.

Apple took its grievances to the Court in 2024 after the European Commission designated its five App Stores on iPhones, iPads, Mac computers, Apple TVs and Apple Watches as a single core platform service under the Digital Markets Act.

Judges sided with the EU competition enforcer.

"Irrespective of the devices in question, those stores have the same purpose, namely to connect app developers with end users in order to facilitate the distribution of software applications," they said.

The iPhone maker also contested the labelling of its operating system iOS as an important gateway for businesses to reach users requiring it to allow rivals to inter-operate with the system.

Apple also disputed the designation of its messaging service iMessage as a number-independent interpersonal communications service, or NIICS, which could subject it to DMA rules.

"That classification does not, by itself, produce binding legal effects that bring about a change in Apple's legal position," the Court said.

"In particular, none of the obligations laid down by the DMA applies to iMessage since that service has not been listed in a designation decision as an important gateway."

The cases are T-1079/23 Apple versus Commission, T-1080/23 Apple versus Commission and T-214/24 Apple and Apple Distribution International versus Commission.

(Reporting by Foo Yun Chee; editing by Inti Landauro and Babrara Lewis)