Apple Introduces New Commission Structure for Apps in the EU
Apple announced on Tuesday a revised commission structure for apps in the European Union, seeking to address its ongoing disputes with the European Commission regarding business practices. The updated model replaces the previous per-install Core Technology Fee with a simplified 5% commission on digital goods sold in apps distributed outside the App Store or via the web.
This latest change signifies Apple’s efforts to align its App Store policies with EU regulations following protracted negotiations with regulators over the fairness and complexity of its terms.
Revisions After Regulatory Scrutiny
In 2022, Apple faced a €500 million fine for violating the EU’s Digital Markets Act, prompting adjustments to its App Store fees. Critics labeled the prior fee structure—characterized by multiple charges and tiers—as an instance of “malicious compliance.” The former setup comprised initial acquisition fees and service tiers based on developers’ needs.
Under the new terms, Apple’s in-app purchase fees now stand at 26%, reduced from the previous 30%. However, many developers may qualify for a reduced fee of 15% through programs like the App Store Small Business Program, Mini Apps Partner Program, and Video Partner Program, as well as for auto-renewing subscriptions after their first year.
New Payment Processing Policies
Apps utilizing alternative payment methods will incur a 20% commission, which may drop to 10% if developers participate in special programs. Additionally, developers must commit to their selected payment methods for a minimum of 12 months, whether that includes Apple’s in-app purchases, external payment systems, or a combination of both.
To enhance flexibility, the revised rules allow some developers to incorporate external links within their apps, though this is not permitted for apps in the Kids category aimed at ensuring safety. Moreover, users under 18 will require parental consent before completing purchases outside the App Store.
Streamlined Access for Alternative App Stores
Importantly, Apple has eased the criteria for developers wishing to launch alternative app stores. The previous requirements mandated substantial financial backing or a two-year membership in Apple’s Developer Program, including the condition that the app must have exceeded 1 million first annual installs in the EU during the prior year. The new rules no longer necessitate proof of these specific milestones, although such methods remain an option for developers. Alternative ways to establish financial viability now include public company status, financial audits, and qualifying venture capital funding.
