App store and digital platform regulation

The Digital Markets, Competition and Consumers Act 2024 introduces UK-specific regulation of large digital platforms. If your business operates a major app store or digital platform, you may be subject to Strategic Market Status (SMS) designation.

This guide also covers what developers and businesses using major platforms need to know about their rights.

Digital Markets Act overview

What is Strategic Market Status?

The CMA's Digital Markets Unit (DMU) can designate large digital platforms with SMS if they:

• Have substantial and entrenched market power in at least one digital activity
• Have a position of strategic significance allowing influence over competition
• Meet turnover thresholds (over £25 billion globally or £1 billion UK)

SMS designation lasts 5 years and triggers conduct requirements.

Conduct requirements for SMS platforms

What this means in practice

Fair dealing:

• Terms must be fair and reasonable
• Cannot impose unfair terms on developers or users
• Must explain decisions affecting users' access

Open choices:

• Cannot prevent users switching to competitors
• Cannot make switching unreasonably difficult
• Must allow data portability where required

Interoperability requirements

Potential platform obligations

The CMA can require SMS platforms to:

• Allow alternative app distribution methods
• Permit third-party payment systems
• Provide access to device features (NFC, Bluetooth, and others)
• Share necessary interoperability data

Pro-competition interventions (PCIs) address specific competition concerns beyond conduct rules.

Commission and fee scrutiny

For app developers

The new regime may benefit developers by:

• Requiring fair and reasonable fee structures
• Enabling alternative distribution channels
• Allowing alternative in-app payment options
• Providing clearer appeals processes

Note: Changes will depend on CMA decisions regarding specific platforms.

Dispute resolution

Developer rights

If you're affected by SMS platform conduct:

• Complain to CMA - report conduct requirement breaches
• Private action - seek damages through the courts
• Collective proceedings - join group claims
• Injunctions - courts can order platforms to stop harmful conduct

Enforcement and penalties

The CMA has strong enforcement powers:

• Fines - up to 10% of global annual turnover for conduct breaches
• Daily penalties - up to 5% of daily global turnover for continued breaches
• Senior manager liability - personal liability for obstructing investigations
• Interim measures - can impose temporary requirements pending investigation