Italy Fines Apple Over Alleged App Store Privacy and Competition Breaches

The fine was announced on Monday by Italy’s competition authority, known as the Autorità Garante della Concorrenza e del Mercato, or AGCM. The regulator said Apple and two of its divisions had breached European competition rules by imposing unfair conditions on app developers using the company’s App Store platform.

According to the AGCM, Apple holds what it described as “absolute dominance” in the distribution of mobile applications on its operating system. The authority argued that this position allowed the company to dictate terms to third-party developers in a way that harmed competition and business partners.

The investigation began in May 2023 and focused on changes Apple introduced in April 2021 through its App Tracking Transparency system. The system requires apps to ask users for permission before tracking their activity for advertising purposes.

Regulators said that under these rules, Apple forced third-party developers to comply with stricter privacy requirements than those applied to Apple’s own services. Developers were required to seek explicit consent for data collection and data linking for advertising through a mandatory screen controlled by Apple.

“The terms of the App Tracking Transparency policy are imposed unilaterally,” the AGCM said in a statement. It added that the measures were “detrimental to the interests of Apple’s business partners and are not proportionate to achieving the objective of privacy”.

The authority also said that developers were required to duplicate consent requests for the same purpose, creating additional burdens and potentially discouraging users from agreeing to data collection. According to the regulator, this process did not comply with European privacy regulations as applied within a competitive market framework.

Apple responded by rejecting the findings. In a statement, the company said it “strongly disagrees” with the decision, arguing that the ruling failed to recognise the privacy protections offered to users. Apple said its App Tracking Transparency feature was designed to give users greater control over how their data is used across apps and websites.

The company said the rules apply equally to all developers, including Apple itself. It added that the system provides a clear and consistent way for users to make informed choices about data tracking, which Apple described as a core principle of its products.

Apple also confirmed that it plans to appeal against the fine and said it would continue to defend what it called strong privacy protections for consumers.

The AGCM said its investigation was complex and involved close coordination with the European Commission and other international competition authorities. This reflects growing scrutiny of large technology companies across Europe, where regulators have increasingly focused on market dominance, data use and the balance between privacy and competition.

The Italian decision comes as European regulators intensify enforcement of competition law in the digital sector. Authorities have argued that companies controlling major digital platforms can shape markets in ways that disadvantage smaller firms, even when policies are presented as consumer-friendly.

In recent years, Apple’s App Store practices have been examined by regulators and courts in several jurisdictions. Critics have argued that Apple’s control over app distribution and data access gives it an unfair advantage over independent developers, particularly in advertising-driven business models.

Supporters of Apple’s approach, however, say the company has raised industry standards for user privacy and transparency at a time when data collection has become a central concern for regulators and consumers alike.

Context

The fine of €98.6 million, equivalent to about $115 million, is one of the most significant penalties imposed by Italy’s competition authority on a technology company. It highlights the ongoing tension in Europe between promoting digital privacy and ensuring fair competition in highly concentrated markets.

The case also underscores broader regulatory pressure on major technology firms operating in the European Union. New and existing rules, including competition law and digital market regulations, are increasingly being used to challenge how large platforms design their products and interact with business users.

While Apple’s appeal could delay or alter the outcome, the ruling signals that European regulators remain willing to challenge global technology companies over practices they believe distort competition, even when those practices are linked to user privacy objectives.