Apple loses EU regulatory lawsuit, facing comprehensive constraints under DMA for App Store and iOS system

According to the Zhitong Finance APP, the General Court of the European Union recently ruled to dismiss Apple Inc.'s (AAPL.US) challenge regarding the scope of the Digital Markets Act (DMA), which means that Apple's App Store and iPhone operating system will have to fully comply with the provisions of the law. The court found that the designation of these two services as "gatekeepers" by EU regulators was lawful and compliant, and Apple's defense was not valid.

In its ruling, the court explicitly stated that it "confirms Apple's designation as a gatekeeper in relation to the App Store and iOS, while ruling that the related actions concerning the iMessage service are not admissible."

As one of the technology companies facing the strongest resistance from EU regulators, Apple previously raised objections on three levels: first, the obligation to ensure interoperability between competing hardware and the iPhone; second, the decision to include the profitable App Store under regulatory oversight; and third, the investigation procedure where regulators initially intended to include iMessage but later exempted it. This ruling essentially negates the first two defenses.

Although the ruling can still be appealed to the EU's highest court, this outcome may further bolster the determination of EU regulators to constrain Silicon Valley companies under the Digital Markets Act. The law has faced widespread criticism from Apple and the Trump administration.

During last year's hearing, Apple argued that the law "imposes extremely burdensome and intrusive obligations," contrary to the rights Apple enjoys in the EU market. However, the European Commission countered at the time that Apple's "absolute control" over the iPhone allowed it to "extract excessive profits in markets where competitors are constrained and unable to compete fairly."

The Digital Markets Act officially came into effect in 2023, aiming to regulate the market behavior of the world's largest technology platforms through a series of "dos" and "don'ts." However, since EU regulators began enforcement, the law has sparked dissatisfaction from former President Trump and has continued to complicate trade negotiations between Europe and the United States.

It is worth mentioning that Apple’s App Store has previously been fined €500 million (approximately $571 million) for alleged violations, and Apple is separately pursuing legal action regarding that penalty. Wednesday's court ruling, while independent of the penalty case, undoubtedly provides judicial backing for the EU to further strengthen its regulation of large technology companies