Apple Inc (NASDAQ:AAPL, ETR:APC) is being investigated by the European Commission over its decision to expel Fortnite developer Epic Games from its App Store.
European Union regulators are upping the ante on their implementation of the Digital Markets Act (DMA) aimed at regulating tech giants, as shown earlier this week with the €1.8 billion fine doled out to Apple for breaching competition rules in music streaming.
Today, the EC executive arm of the bloc requested “further explanations” from Apple over its decision to terminate Epic’s developer account, according to media reports.
This followed a statement from Epic yesterday that said, although Apple had approved a developer account for Epic Games Sweden, which it had intended to use to bring the Epic Games Store and Fortnite to Apple devices in Europe, "to our surprise, Apple has terminated that account".
Epic called it "a serious violation of the DMA and shows Apple has no intention of allowing true competition on iOS devices".
By terminating the developer account, the Cupertino megacap is effectively barring the company from offering its games to Apple's mobile users or initiating a competing app store on its iOS operating system in Europe.
The deadline for companies to comply with the DMA legislation, designed to diminish the dominance of large online platforms, was set for March 7.
On top of Epic-DMA questions, the Commission is also assessing whether Apple's actions contravene other EU legislation.
Apple recently proposed changes to its iOS software in response to the DMA, allowing for app downloads from alternative sources and the use of different payment systems.
However, the company's plan to impose new fees on developers using rival app stores has sparked criticism and calls for further EU regulatory intervention, according to reports.
Apple justifies its action against Epic as lawful under a 2021 US court ruling, citing an "egregious breach of contractual obligations" by Epic, with the dispute traced back to Epic's attempt to circumvent Apple's App Store imposing a 30% commission on in-app payments in 2020, which resulted in a largely unsuccessful legal challenge against Apple in the US.
Although Epic lost its claims at trial, a US district court judge ruled Apple's ban on letting developers inform customers about alternative payment methods violated a California unfair competition law.
Last year, following an antitrust lawsuit by the Fortnite developer, Apple petitioned the US Supreme Court to overturn an order mandating changes to its app store regulations.
In January this year, Epic accused Apple of failing to fully comply with a court order that demanded changes to App Store policies, saying while it had agreed to let third-party apps in the US include an external link for in-app purchase payments, it continues to demand a commission of up to 27% on purchases made outside the App Store.