Apple Filing Reveals iPhone Maker Expects to Change App Store Policy to Comply With EU Regulation

Apple expects it will be compelled to make changes to its App Store policies, as the firm must comply with the European Union's new Digital Markets Act (DMA). The iPhone maker's recent filing with the US Securities and Exchange Commission (SEC) shows the company expects to make policy changes related to applications running on iOS and iPadOS, the company's operating systems for iPhone and iPad, respectively. Until now, the EU has named seven major tech firms — including Apple — that will be governed under the new regulations.

TechCrunch reports that Apple, in its recent Form 10-K filing with the US SEC, states that it expects that it will have to make changes to the App Store in order to comply with the EU's DMA regulation. The iPhone maker also said in the filing that it might also introduce other changes to its policies governing external app distribution, platform access charges for developers, and communications related to alternate billing systems.

According to the report, Morgan Stanley analysts have also written to clients that the change in Apple's language suggests that the App Store policy changes — including allowing third party apps on devices in Europe — are likely to begin. The EU's DMA regulations are expected to fully go into effect starting in 2024 and will impact companies that have a market valuation of EUR 75 million (roughly Rs. 670 crore) or 45 million monthly active users (MAUs) living in the EU.

Last year, Bloomberg reported that Apple was already preparing its systems to allow alternative app stores on iPhone and iPad, as the company would have to comply with the incoming EU regulations aimed at checking the power of Big Tech firms.

If the mandatory App Store distribution limit is lifted, developers might be able to sidestep Apple's up-to-30 percent commission charged on all App Store transactions. In the US, Apple has fought — and largely won — an antitrust trial against Fortnite maker Epic Games after it booted the developer for flouting its App Store policies. 

Apple is not the only Big Tech firm that will be impacted by the EU's DMA rules when they go into effect in 2024. The new rules require tech firms to allow users to easily change default settings, sideload apps outside the default app store, and allow users of major messaging platforms to chat with each other, while allowing smaller platforms to also access core features and functionality.

According to Bloomberg, the changes being developed by the company will only go into effect in the EU for the foreseeable future, but the move could lead to the company opening up its systems in other regions, if legislation or regulation related to limiting the reach of Big Tech firms is passed in other regions.