Apple, Microsoft Win Exemption From EU Gatekeeper Designation

Two big name tech giants have won exemptions for two of their services, that would have subjected those services to tough new European Union laws.

It was back in July 2022 when the European Parliament voted to adopt the Digital Markets Act (DMA) and Digital Services Act (DSA) – landmark rules that impose significant regulatory burdens on so called ‘Gatekeeper’ firms, such as Amazon, Apple, Alphabet, Meta, TikTok, X and others.

The EU’s Digital Services Act (DSA) focuses on how platforms handle user data and moderation, and it went into effect in August 2023.

The DMA came into force in November 2022 and Gatekeepers are required to comply with the DMA by 6 March 2024.

DMA Gatekeepers

In April 2023, the European Commission had published the names of 19 platforms that will face the strictest level of regulation under the DSA, naming 19 so called ‘Gatekeeper’ firms.

Then in September 2023 the European Commission designated ‘gatekeepers’ of online services that were subject to its Digital Markets Act (DMA).

The DMA requires ‘gatekeepers’ to allow third-party apps or app stores on their platforms and make it easier for people to switch to rivals.

Under the DMA, the companies are also prohibited from favouring their services over rivals.

Companies face fines of up to 10 percent of annual global turnover for DMA violations and 6 percent for contravening the DSA.

Gatekeeper appeal

However almost immediately both Apple and Microsoft began privately (and separately) arguing that some of their respective services were not large or powerful enough to justify gatekeeper status under the Digital Markets Act.

These DMA ‘gatekeeper’ platforms are chosen, based on their revenue and user numbers, and will be required to meet a slew of interoperability and competition rules.

Now the European Commission in a statement said it has closed “market investigations on Microsoft’s and Apple’s services under the Digital Markets Act.

“Yesterday, the Commission has adopted decisions closing four market investigations that were launched on 5 September 2023 under the Digital Markets Act (DMA), finding that Apple and Microsoft should not be designated as gatekeepers for the following core platform services: Apple’s messaging service iMessage, Microsoft’s online search engine Bing, web browser Edge and online advertising service Microsoft Advertising,” said the EC.

The Commission said it will continue to monitor the developments on the market with respect to these services, should any substantial changes arise.

It said the decisions do not affect in any way the designation of Apple and Microsoft as gatekeepers on 5 September 2023 as regards their other core platform services.

This means that Apple’s App Store, iOS operating system and Safari browser will continue to be classified as gatekeepers as will Microsoft’s Linkedin social network and the Windows operating system.

Apple, Microsoft reactions

Apple had previously said iMessage usage is negligible, even on its devices, compared to rival messaging services in the EU and that iMessage is not an important channel for businesses to reach users in the bloc.

“Consumers today have access to a wide variety of messaging apps, and often use many at once, which reflects how easy it is to switch between them,” an Apple spokesperson was quoted by Reuters as saying.

Microsoft said that Bing, Edge and Microsoft Advertising operate as challengers in the market and are of relatively small scale, meaning they are not important gateways for business users.

“We will continue to engage with the Commission and industry at large to ensure Microsoft’s other designated platforms comply fully with the DMA,” a Microsoft spokesperson said.