Headquarters of Germany’s Bundeskartellamt
Apple is facing more controls in Germany due to its dominance in the market, as a German federal court has signaled that the country’s antitrust regulator could win its legal fight.
Apple is facing the prospect of being deemed subject to an extended anti-competition law in Germany, and is fighting the country’s Bundeskartellamt antitrust regulator in court over the matter. However, it seems that Apple may not get its way.
On Tuesday, judges from the Federal Court of Justice deliberated for over three hours on whether Apple should be made to deal with additional controls to encourage competition in the market.
Presiding judge Wolfgang Kirchhoff said that an assessment has shown that Apple could be seen as having considerable enough significants across markets to be subjected to the additional controls, reports Reuters.
However, the court did not issue a ruling, and wanted more time to deliberate.
Apple’s legal team asked for the court to discuss the matter with the European Court of Justice in Luxembourg ahead of making a decision, on the belief that EU and German law don’t necessarily line up. Judge Kirchhoff said the judges failed to see any grounds for such contact to be made.
Competition checks
The lawsuit was instigated by the Bundeskartellamt in April 2023, with the regulator believing that Apple was subject to a 2021 amendment to the German Competition Act. Section 19a of the act, which came into force in January 2019, adds more controls and checks for companies that the regulator deems to be of “paramount significance for competition across markets.”
Following the addendum, the regulator was quick to start an investigation using its new powers into the App Store and Apple’s activities.
At the time, Bundeskartellamt president Andreas Mundt said Apple operates a “wide-ranging digital ecosystem which is of great importance to competition not only in Germany, but also throughout Europe and the world.” With control of iOS and the App Store Apple therefore “holds a key position for competition,” he continued.
Apple’s lawsuit aims to defeat the regulator’s decision, and therefore allow Apple to operate without the extra checks to prohibit anti-competitive practices.
So far, Google parent company Alphabet and Facebook owner Meta are companies that have to deal with the extra controls.
As part of the regulations, the Bundeskartellamt’s decision is limited to a five-year period, a timer that started in April 2023. If Apple fails to convince the court to side with it on the matter, the designation will still stand until April 2028.
The legal fight is also separate from the regulator’s other Apple-related activities. In June 2022, it launched an antitrust investigation into Apple over App Tracking Transparency, specifically complaints that ATT rules that applied to third-party app producers didn’t apply to Apple itself.
Germany’s activity also follows after years of attempts by the EU and other governments to curtail the power of tech giants in the marketplace.
The most recent attempt are the Digital Markets Act and Digital Services Act, a set of rules to try and force gatekeepers to act in a competition-promoting way.
This included forcing Apple into allowing third-party App Store alternatives onto the iPhone in the EU, and eliminating anti-steering rules. Changes that Apple dragged its heels over, but eventually relented in some cases.
