Ban on epic games developer account
Three different legislation may be relevant, according to the European Union, which has stated it is investigating Apple’s decision to terminate Epic Games’ developer account.
The creator of Fortnite said yesterday that Apple had closed the account, ostensibly going back on their decision to grant the developer access last month.
In addition to Fortnight on Apple’s platform, Epic had intended to release its own app store, the Epic Games Stores, for iOS in Europe. Additionally, it charged that Apple had terminated its developer account in violation of the bloc’s Digital Markets Act (DMA).
A representative for the European Commission responded to the news by telling TechCrunch that the organization has “requested further explanations on this from Apple under the DMA.”
Apple is subject to the pan-EU regulation as of today at midnight Brussels time.
The spokesperson added that given what they called “the links between the developer program membership and the App Store as designated VLOP” (very large online platform), the EU is assessing whether Apple’s actions raise compliance “doubts” with regard to two other regulations: the Digital Services Act (DSA) and the platform-to-business regulation (P2B).
The EU’s DMA mandates that Apple allow third-party app shops since it is a designated “gatekeeper” and its App Store is a “core platform service.” Significant fines of up to 10% of the global yearly turnover (or 20% for repeat offenders) could result from noncompliance with the DMA.
While the remaining sections of the DSA have been in effect for platforms and many more digital services since last month, a portion of the regulations have been in effect for larger platforms since August 2023 and also apply to Apple’s App Store as a designated VLOP. Penalties for DSA violations might amount to as much as 6% of the total yearly turnover worldwide.
In the meanwhile, the EU’s P2B regulation includes provisions meant to increase platform openness and stop unfair business practices. It has been in effect since 2020, which is more time.
P2B laws prohibit abrupt and unforeseen account suspensions, and platforms must give platforms users a cause for terminating an account. However, P2B enforcement is not under the Commission’s purview, in contrast to the DMA and the DSA’s VLOP regime. It has been sent over to authorities at the member state level, who also decide on any potential sanctions for violations. Given the degree of overlap in scope, it is plausible that Commission enforcers may consider platforms’ compliance with P2B regulations when evaluating VLOPs’ DSA compliance.
Epic claims that Apple closed its developer account against it because the company objected to the iPhone maker’s DMA plan, which calls for developers to agree to new terms and conditions that include a new “core technology” in order to use DMA entitlements.
In a forceful statement released yesterday, Apple refuted Epic’s allegations and provided a U.S. court decision as support for canceling its account. Additionally, it implied that Epic’s application for an Apple Developer Program License Agreement was completed using a click-through agreement and stated that no executive had examined it.
“Epic’s flagrant breach of its contractual commitments to Apple prompted courts to rule that Apple had the authority to fire ‘any or all of Epic Games’ wholly owned subsidiaries, affiliates, and/or other businesses under Epic Games’ control at any time and at Apple’s sole discretion. In light of Epic’s previous and ongoing activity, Apple elected to use that privilege,” Apple noted yesterday, citing a September 2021 U.S. court ruling on Epic’s litigation against Apple. The game developer sued Apple in the United States, claiming that it was abusing its market position by requiring companies to use its own payment systems.
In September 2021, a US court determined that Apple does not have a monopoly in digital mobile gaming transactions. Although it does not ban developers from including links in their apps that route users to payment systems other than the App Store for the purchase of digital products.
Apple hailed the decision as a victory, claiming that the court had determined that the App Store did not violate antitrust laws. The US court also did not order Apple to enable third-party app stores or sideloading. However, under the EU’s DMA, Apple is required to allow third-party app stores and software downloads while not prohibiting business users from supplying products through their own channels.
The U.S. court order that Apple is using to justify terminating Epic’s developer account is unlikely to have standing in the EU. However, Apple may be attempting to pit one legal jurisdiction against another, which has recognized its market power as a concern and has already implemented regulations governing how it can operate its App Store.
Apple was approached for a response to the Commission’s request for additional explanations of its DMA activities, as well as the bloc’s concerns regarding Apple’s compliance with other DSA and P2B controls imposed on the App Store. It stated that it has nothing additional to add to its remarks from yesterday, in which it argued that the US court verdict upheld its contractual right to cancel Epic’s account.
“This is a serious violation of the DMA and shows Apple has no intention of allowing true competition on iOS devices,” Epic Games said on the account deletion.
