UK competition regulator begins consultation on potential measures to allow third-party payment methods with reduced fees
The Competition and Markets Authority has begun a consultation into proposed measures to force Apple and Google to allow developers to route in-app payments outside of the OS makers’ app stores.
The competition regulator said allowing alternate payment options could reduce fees for developers and boost competition.
The consultation comes after the CMA designated the companies last October as having strategic market status, or SMS, allowing it to impose tailored conduct rules.
CMA executive director for digital markets Will Hayter said it was important to give “app developers and users more choice” around communications and transactions.
Speaking at the Informa Connect CompLaw conference on Tuesday, he acknowledged that it was “fair” for Apple and Google to be compensated for their services, but their fees should be “justified through a robust, evidence-led framework involving due reference to both cost and value”.
The Coalition for App Fairness, whose members include Epic Games, Spotify and Match, said the CMA’s latest proposals don’t go far enough.
It said conduct requirements must “explicitly prohibit or restrict fees” charged through third-party methods, or any changes risked being “little more than cosmetic”.
Apple said the CMA proposal would undermine consumer protections, while Google said it had already made the required changes.
Both companies have challenged such measures in other jurisdictions, with Apple allowing third-party payment systems in the US, for example, but charging fees only slightly lower than those using its App Store payment system.
Legal challengeApple has been ordered to negotiate those fees with a US district judge in California, but the proceedings haven’t yet started.
Google has brought in new rules allowing third-party transactions, but fees of up to 20 percent are still charged for such payments.
Historically Apple and Google have both charged up to 30 percent commissions on transactions.
The companies’ app store rules are also being challenged under the EU’s Digital Markets Act.
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