Summary of Commission Decision of 5 September 2023 designating Apple as a gatekeeper pursuant to Article 3 of Regulation (EU) 2022/1925 of the European Parliament and of the Council on contestable and fair markets in the digital sector (Cases DMA.100013 Apple – online intermediation services – app stores, DMA.100025 Apple - operating systems and DMA.100027 Apple – web browsers) (notified under document number C(2023) 6100 final)
Date: 2023-09-05
Institutions: Directorate-General for Competition, European Commission
Subjects: browser, competition law, digital economy, digital single market, electronic commerce, operating system, provision of services








C_202300548EN.000101.fmx.xml












Official Journal of the European Union


EN
Series C













C/2023/548


27.10.2023






Summary of Commission Decision
of 5 September 2023
         
designating Apple as a gatekeeper pursuant to Article 3 of Regulation (EU) 2022/1925 of the European Parliament and of the Council on contestable and fair markets in the digital sector
(Cases DMA.100013 Apple – online intermediation services – app stores, DMA.100025 Apple - operating systems and DMA.100027 Apple – web browsers)


(notified under document number C(2023) 6100 final)


(Only the English text is authentic)
(C/2023/548)


On 5.9.2023, the Commission adopted a decision pursuant to Article 3 of Regulation (EU) 2022/1925 of the European Parliament and of the Council
          (1)
. In accordance with the provisions of Article 44 of Regulation (EU) 2022/1925, the Commission herewith publishes the names of the parties and the main content of the decision, having regard to the legitimate interest of undertakings in the protection of their business secrets.

1.   INTRODUCTION









(1)


The Designation Decision (‘the Decision’) designates Apple as a gatekeeper pursuant to Article 3 DMA in relation to a number of core platform services (‘CPSs’) that are provided by Apple and which, following the Commission’s analysis, individually constitute an important gateway for business users to reach end users as referred to in Article 3(1)(b) DMA.












(2)


Based on the information in the notification by Apple (2), the Commission designates, pursuant to Article 3(4) DMA, Apple as a gatekeeper, in relation to the following CPSs:






a.


Apple’s online intermediation service App Store;










b.


Apple’s operating system iOS;










c.


Apple’s web browser Safari.
















(3)


Together with its notification, Apple submitted pursuant to Article 3(5) DMA a rebuttal request in relation to its number-independent interpersonal communications service (‘NIICS’), iMessage (3). In a separate decision adopted by empowerment on the same day, the Commission concludes that Apple provided sufficiently substantiated arguments to manifestly call into question the presumptions in Article 3(2) DMA and therefore decided to open a market investigation.




2.   PROCEDURE









(4)


On 3 July 2023, Apple notified the Commission, pursuant to Article 3(3), first subparagraph DMA, that it meets the thresholds laid down in Article 3(2) DMA in relation to the following CPSs: (i) its online intermediation service iOS AppStore; (ii) its operating system iOS; (iii) its web browser Safari on iOS; and (iv) its NIICS iMessage (4).












(5)


On 25 July 2023, to provide Apple with the right to be heard, the Commission sent Apple a letter outlining its preliminary views on Apple’s notification.












(6)


Apple replied to the Commission’s letter on 1 August 2023.




3.   LEGAL FRAMEWORK









(7)


The DMA establishes a set of narrowly defined objective criteria for qualifying a large online platform as a gatekeeper. Designation is to be made in relation to one or more CPSs provided by the undertaking that are an important gateway for business users to reach end users within the meaning of Article 3(1), point (b) DMA. In order to determine whether a service provided by an undertaking is a CPS that meets the requirement set out in Article 3(1), point (b) of the DMA, it is necessary, as a preliminary step, to qualify and delineate the respective service. A relevant criterion for qualifying and delineating CPSs is the purpose for which the service is used by either end users or business users or both.












(8)


According to Article 3(1) DMA, the Commission is to designate an undertaking as a gatekeeper if it fulfils three cumulative requirements, namely: (a) it has a significant impact on the internal market; (b) it provides a CPS which is an important gateway for business users to reach end users; and (c) it enjoys an entrenched and durable position, in its operations, or it is foreseeable that it will enjoy such a position in the near future. Article 3(2) DMA lays down a presumption that those requirements are satisfied where certain quantitative thresholds are met, namely the company’s turnover or market capitalisation as well as the numbers of end users and business users of a particular CPS in each of the last three financial years.












(9)


Pursuant to Article 3(5), first subparagraph DMA, an undertaking that meets all the thresholds laid down in Article 3(2) DMA may present, with its notification, arguments to demonstrate that, although it meets all those thresholds, it exceptionally does not satisfy the requirements laid down in Article 3(1) DMA due to the circumstances in which the relevant CPS operates. Article 3(5), second subparagraph, DMA provides that if the arguments submitted are not sufficiently substantiated because they do not manifestly call into question the presumptions set out in Article 3(2) DMA, the Commission may reject the arguments. By contrast, should the Commission consider that the submitted evidence is sufficient to demonstrate that the requirements laid down in Article 3(1) DMA are not fulfilled, it may accept the rebuttal with or without opening a market investigation pursuant to Article 17(3).












(10)


When an undertaking does not satisfy the quantitative thresholds of Article 3(2) DMA but meets the criteria of Article 3(1) DMA, the Commission shall designate this undertaking as a gatekeeper with respect to the specific CPS pursuant to Article 3(8) DMA after conducting a market investigation pursuant to Article 17 DMA.




4.   THE COMMISSION’S ASSESSMENT









(11)


Following the notification by Apple, the Decision establishes that the following services constitute CPSs within the meaning of Article 2 DMA and are individually an important gateway for business users to reach end users as referred to in Article 3(1)(b) DMA:






a.


Apple’s online intermediation service App Store;










b.


Apple’s operating system iOS;










c.


Apple’s web browser Safari.
















(12)


With respect to Apple’s online intermediation service App Store, Apple argued that there are five device-specific versions of the app store (i.e., iOS App Store, iPadOS App Store, etc.) which individually constitute distinct online intermediation services and therefore CPSs within the definition of the DMA. This is because, according to Apple, app stores serve different purposes from both an end user as well as a business user perspective depending on the device. According to Apple, only the iOS version of the App Store offered for the iPhone meets the quantitative thresholds for designation. The Commission designates Apple’s software application store App Store, which is currently offered on different Apple devices running on iOS, iPadOS, macOS, watchOS and tvOS (together the ‘App Store’), as a single CPS, irrespective of the device on which it is used. This is because, based on the evidence in the file, the App Store is used for the same common purpose from both an end user and a business user perspective across all devices on which it is available, namely to intermediate the distribution of apps.












(13)


With respect to Apple’s web browser Safari, Apple submitted that Safari offered on different Apple devices running on iOS, iPadOS and macOS each constitutes a separate CPS, and that only Safari on iOS meets the quantitative thresholds for designation. Apple contends that Safari is device-specific and is used differently by end users and business users depending on the device. The Commission designates Safari as a single CPS, irrespective of the device on which it is offered. This is based on the fact that Safari serves a common purpose across devices, namely that of providing end users and business users with a tool to offer, access and interact with web content.












(14)


With respect to iMessage, Apple argued that iMessage does not constitute a CPS within the meaning of the DMA as (i) it is not provided for remuneration (which is one of the elements for any service to qualify as an interpersonal communication service (‘ICS’) pursuant to Article 2(5) of Directive (EU) 2018/1972 to which definition in Article 2, point (2)(e) DMA refers), (ii) regardless of the qualification of iMessage as a NIICS, it is not designed for business-to-consumer (‘B2C’) communication as it is not equipped with customer relationship management (‘CRM’) solutions, and (iii) it does not allow for creating a business account. Contrary to Apple’s views, to the Commission considers that iMessage constitutes a NIICS, as Apple receives a remuneration through, inter alia, the sale of Apple devices on which iMessage is pre-installed and because there is a business side to iMessage (observing in this respect that neither the provision of CRM solutions, nor creation of specific business accounts are requirements for qualifying a service as a NIICS CPS). However, in light of Apple’s arguments pursuant to Article 3(5) DMA, the Commission concludes in a separate decision to be adopted by empowerment that Apple has presented sufficiently substantiated arguments manifestly calling into question the presumptions in Article 3(2) DMA. In particular, Apple has presented arguments directly relating to criteria laid down in Article 3(2)(b) and (c) DMA and has supported these arguments with data on the relatively lower scale of iMessage compared to the overall scale of the relevant CPS and to other undertakings providing the same CPS. By this separate decision, the Commission opens a market investigation, pursuant to Articles 16(1) and 17(3) DMA. The Commission will have 5 months to conclude the investigation whether Apple is a gatekeeper in relation to iMessage.












(15)


Finally, the Commission designates Apple as gatekeeper in relation to its Apple’s operating system iOS. The Commission considers that Apple has provided sufficient facts and arguments to hold that iOS and iPadOS constitute each a distinct operating system CPS, with only iOS meeting the quantitative thresholds for designation. As a result, the Commission designates iOS as a CPS within the meaning of DMA.












(16)


The findings in the Decision are based on the information available to the Commission at the time of the Decision. Should there be any substantial change in any of the facts on which this Decision is based, or if this Decision is based on incomplete, incorrect or misleading information, the Commission may reconsider or amend the Decision pursuant to Article 4(1) DMA.




5.   CONCLUSION









(17)


For the reasons set out above, the Commission designates Apple as a gatekeeper in relation to (i) Apple’s online intermediation services AppStore; (ii) Apple’s operating system iOS; and (iii) Apple’s web browser Safari.






(1)  Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ L 265, 12.10.2022, p. 1).

(2)  Notification of 3 July 2023 made by Apple Inc. and its European subsidiary Apple Distribution International Ltd. pursuant to Article 3(3) DMA.

(3)  While Apple includes iMessage within the list of CPSs in its notification, it argues that iMessage does not constitute a NIICS.

(4)  While Apple includes iMessage within the list of CPSs in its notification, it argues that iMessage does not constitute a NIICS. Apple also put forward arguments pursuant to Art 3(5) DMA to rebut the presumptions laid down in Article 3(2) DMA in relation to iMessage.


ELI: http://data.europa.eu/eli/C/2023/548/oj
ISSN 1977-091X (electronic edition)