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In the first-ever concession of its kind, Apple has announced that it will allow third-party payment options for in-app purchases for dating apps in the Netherlands.
In a bulletin sent to its developer site, Apple has announced that it will comply with a ruling set by the Netherlands antitrust authority that compels it to allow dating apps to promote third-party payment service providers.
“Recent orders from the Netherlands Authority for Consumers and Markets (ACM) will allow developers of dating apps on the App Store in the Netherlands to share additional payment processing options with users,” the company said.
Apple continued: “To comply with the ACM's order, we're introducing two optional new entitlements exclusively applicable to dating apps on the Netherlands App Store that provide additional payment processing options for users. Dating app developers who want to continue using Apple's in-app purchase system may do so and no further action is needed.”
The US company has, however, said that it will fight the ACM on this issue.
“Because we do not believe these orders are in our users’ best interests, we have appealed the ACM’s decision to a higher court,” the company confirmed in its post.
Apple’s concerns centre on changes that it believes could compromise the user experience, as well as create new threats to user privacy and data security.
To comply with the ACM’s order, Apple is offering two options. Developers can either use the StoreKit External Purchase Entitlement, which lets you use a third-party payment system within a dating app on the Netherlands storefront, or they can use the StoreKit External Link Entitlement.
The latter lets developers include an in-app link that directs users to their website to complete the purchase.
“Before considering applying for one of these entitlements, it’s important to understand that some App Store features that you may use won’t be available to your customers, in part because we cannot validate the security and safety of payments that take place outside of the App Store’s private and secure payment system,” the company cautioned.
As it will not be directly aware of purchases made using alternative methods, Apple has said that it will be unable to assist users with refunds, purchase history, subscription management and other issues encountered when purchasing digital goods and services through these alternative purchasing methods.
“You will be responsible for addressing such issues with customers,” the company said.
Wider implications
The decision follows a slap-down from the ACM in late 2021.
Announced on Christmas Eve, the ACM dictated that Apple must adjust the conditions for access to the Dutch App Store for dating-app providers. Dating-app providers must also be able to use payment systems other than Apple’s payment system in the App Store.
Hereby, dating-app providers must also have the ability to refer in their apps to payment options outside the app. The most dominant dating app in the Netherlands is Tinder, which statistics suggest has a 60 percent market share.
On iPhones, dating apps can only be offered through the App Store, which makes dating-app providers highly dependent on Apple.
Therefore, dating-app providers have little choice but to accept Apple’s conditions, with the ACM establishing that Apple has a dominant position.
“Some app providers are dependent on Apple’s App Store, and Apple takes advantage of that dependency. Apple has special responsibilities because of its dominant position,” said Martijn Snoep, the ACM’s chair. “That is why Apple needs to take seriously the interests of app providers too and set reasonable conditions. That is what we are forcing Apple to do with this order. Protecting people and businesses against abuse of market power in the digital economy is one of our most important duties.”
The bigger question for Apple is if this decision has wider implications for its payments set-up beyond just dating apps. Following this decision, other app developers using Apple's platform may also demand access to third-party payments.
The Dutch have been leaders in Europe in lobbying for tighter regulation for bigtech platforms. In 2018, the Dutch government called for Apple to open up its near field communication (NFC) to the Dutch authentication system DigiD.
In addition, the ACM closed an investigation in July, conceding that Apple’s NFC infrastructure is anti-competitive, but that current regulation is unsuitable for dealing with the concerns.
The authority recommended changes from Brussels to deal with this. New EU laws, such as the Digital Markets Act and the proposal for an EU-wide digital wallet, are likely to cause problems for Apple’s modus operandi in the payments world.
Internationally, Australian financial leaders have also raised concerns about the gatekeeper effect of Apple’s NFC infrastructure.
Meanwhile, Apple has also raised eyebrows in the Nordics. When Apple Pay launched in Norway, it was reported to the Norwegian competition authority for a potential breach of antitrust laws. In Denmark, it was reported to the competition regulator for automatically choosing Visa over national scheme Dankort.
