The French Competition Authority has imposed a fine of €150 million ($162.42 million) on Apple for abusing its dominant position in the mobile application distribution market on iOS and iPadOS devices between April 2021 and July 2023.
The fine is linked to Apple’s implementation of the App Tracking Transparency (ATT) system, which the Authority determined was neither necessary nor proportionate to Apple’s stated objective of protecting personal data.
Background of the Case
Apple introduced the ATT system on April 26, 2021, with the launch of iOS 14.5 and iPadOS 14.5. This system required iPhone and iPad users to provide explicit consent before third-party applications could track their data for advertising purposes. The ATT prompt asked users to either allow or deny tracking, with denial leading to restrictions on the use of the Identifier for Advertisers (IDFA), a unique device identifier used for targeted advertising.
Concerns regarding ATT’s impact on competition arose as several associations representing media, advertising agencies, publishers, and mobile marketing firms raised complaints with the Competition Authority in October 2020. These stakeholders argued that ATT would significantly hinder their ability to conduct targeted advertising, a crucial revenue source for app developers and online advertising firms.
Competition Authority’s Findings
Following an in-depth investigation, the Competition Authority concluded that while ATT’s stated aim of enhancing user privacy was legitimate, its implementation was excessive and unfairly disadvantaged third-party app publishers. The Authority identified several anti-competitive aspects of Apple’s ATT system:
- Unnecessary and Disproportionate Measures: The introduction of ATT resulted in multiple consent requests that complicated the user journey within the iOS ecosystem. This led to increased friction for third-party app developers while Apple’s own advertising systems operated under less stringent conditions.
- Distortion of Market Neutrality: The ATT framework forced third-party publishers to collect double opt-in consent for tracking, while Apple was able to continue collecting user data under a single consent process for its own advertising purposes. This asymmetric treatment gave Apple an unfair competitive advantage.
- Disadvantage to Smaller Publishers: Smaller app developers and publishers, who rely heavily on third-party advertising for revenue, were disproportionately affected by ATT’s implementation. Unlike major tech firms such as Google and Meta, which have vast ecosystems of first-party data, smaller players faced a substantial decline in ad revenues due to reduced access to targeted advertising.
- Artificial Complexity in User Consent Process: The ATT system required users to confirm consent twice when allowing tracking but only once when denying it. This asymmetry created an inherent bias against third-party tracking and obstructed competition in the mobile advertising sector.
Regulatory and Legal Considerations
The Competition Authority’s ruling aligns with ongoing discussions on the intersection of data protection and competition law. In December 2023, the French data protection authority (CNIL) and the Competition Authority issued a joint statement reaffirming their commitment to addressing issues where privacy and competition concerns overlap. The CNIL noted that minor adjustments to the ATT system could have ensured compliance with privacy regulations without distorting competition.
Additionally, Apple’s handling of ATT raised concerns under the ePrivacy Directive. In a separate case, the CNIL had previously penalized Apple for failing to seek user consent before collecting data for its own advertising purposes prior to the introduction of iOS 15.
Penalties and Remedial Actions
In view of the severity of Apple’s practices and the duration of the infringement (April 26, 2021 – July 25, 2023), the Competition Authority imposed a fine of €150 million on Apple Distribution International Limited, Apple Inc., and its parent companies, Apple Operations International Limited and Apple Inc.
Furthermore, Apple is required to publish a summary of the Authority’s decision on its website for seven consecutive days. The full text of Decision No. 25-D-02, issued on March 28, 2025, will be made publicly available after redacting confidential business information.
Implications for Apple and the Digital Advertising Industry
The ruling represents a challenge to Apple’s approach to privacy enforcement and platform control. The decision may set a precedent for regulatory scrutiny in other jurisdictions where Apple’s App Store policies have been questioned for anti-competitive behavior.
Apple has not yet commented on whether it will appeal the ruling. However, this case reinforces ongoing global regulatory efforts to ensure that dominant digital platforms do not leverage privacy initiatives to unfairly hinder competition and distort the advertising market.
