On July 27, 2023, the General Rapporteur of the French Competition Authority (“FCA”) confirmed the notification to Apple of a statement of objections (“SO”) concerning potential anticompetitive practices in the sector for the distribution of mobile applications, likely to have consequences on several related markets for advertising and consumer services.[1]
Background
In June 2020, Apple announced that as of September 2020, it would launch a new privacy feature called “App Tracking Transparency” (“ATT”). This feature requires mobile applications offered on Apple’s operating system, iOS, to get users’ permission before using Apple’s unique Identifier for Advertisers (“IFA”) to track users’ data across applications or websites owned by third-party companies.
Given the significant impact on advertisers and application publishers, on October 23, 2020, several associations of actors in the online advertising sector (e.g., media, internet networks, advertising agencies, technical intermediaries, publishers, and mobile marketing agencies) launched a complaint against Apple’s new feature to the FCA. They claimed that by implementing the ATT feature, Apple was abusing its dominant position by imposing unfair trading conditions on third-party advertising services that would not apply to its own services. They argued that with ATT, Apple requires third-party applications to obtain users’ consent for certain advertising services while Apple’s own services are not subject to such requirement for advertising purposes. In addition, the associations requested interim measures to prevent Apple from implementing ATT until the adoption of a decision on the merits of the case.
Apple argued that the requirements of its ATT do not apply to its own services because they are irrelevant insofar as Apple does not track individual users across its own services for advertising purposes based on unique user identifiers such as the IFA. Apple explained that it relies only on limited proprietary datapoints that cover cohorts of no less than 5,000 users.
In a decision of March 17, 2021, the FCA rejected the request for interim measures and indicated that it would pursue its investigation to rule on the merits of the case because its preliminary investigation did not conclude that Apple’s practice contravened Art. 102 TFEU.[2]
Proceedings on the merits of the case: the SO
On July 27, 2023, the FCA’s General Rapporteur confirmed that it had sent an SO to Apple because it suspected the company of abusing its dominant position by imposing discriminatory, non-objective, and non-transparent conditions for the collection of user data for advertising purposes.
Interestingly, the German Federal Cartel Office (“FCO”) also opened an investigation into Apple’s introduction of the ATT in June 2022. The FCO is investigating whether Apple is favoring its own services and/or impeding other companies through this new privacy feature by imposing requirements on third parties for advertising purposes that do not apply to its own services.[3] Furthermore, in December 2021, the Office of Competition and Consumer Protection (“UOKiK”) in Poland opened a similar investigation.[4]
These investigations further highlight the growing link between privacy considerations and competition law. In 2019, the FCO found that Facebook (now Meta) had abused its dominant position in the way it collected, merged, and utilized user data not only from its own services but also from third-party services. The use of user data by tech giants for advertising purposes was also at the core of the commitments that Google offered to the European Commission in the Google/Fitbit case[5] and to the UK Competition and Markets Authority (“CMA”) in the Google Privacy Sandbox case.[6]
[1] FCA Press Release, “Advertising on iOS mobile applications: the General Rapporteur confirms having notified the Apple group of an objection”, July 27, 2023, available at: www.autoritedelaconcurrence.fr/en/article/advertising-ios-mobile-applications-general-rapporteur-confirms-having-notified-apple-group.
[2] FCA Decision No 21-D-07 of March 17, 2021, regarding a request for interim measures submitted by the associations Interactive Advertising Bureau France, Mobile Marketing Association France, Union Des Entreprises de Conseil et Achat Media, and Syndicat des Régies Internet in the sector of advertising on mobile apps on iOS.
[3] FCO press release, “Bundeskartellamt reviews Apple’s tracking rules for third-party apps”, June 14, 2022, available at www.bundeskartellamt.de/SharedDocs/Meldung/EN/Pressemitteilungen/2022/14_06_2022_Apple.html.
[4] UOKiK press release, “Apple – the President of UOKiK initiates an investigation”, December 13, 2021, available at https://uokik.gov.pl/news.php?news_id=18092.
[5] Google/Fitbit (Case M.9660) OJ C(2020) 9105, Commission decision of December 17, 2020.
[6] Case 50972, CMA Decision to accept commitments offered by Google in relation to its Privacy Sandbox Proposals.