Distributors of free Apps shall comply with stringent transparency obligations following an investigation from the Italian competition authority.
Last year, the Italian competition authority (AGCM) that in Italy has jurisdiction also on misleading advertising and unfair commercial practices, opened an investigation on game Apps that, although downloadable for free, required users to make subsequent payments in order to continue the game and enjoy all its features.
During the investigation, the AGCM held that the practice could be considered deceptive and misleading for the consumers, also because, among others, the App distributors did not provide the consumer with transparent and full information on the real cost of the App and on how to avoid or limit the purchase of the additional features. And the issue was even more relevant considering the fact that the Apps were addressed to children.
To meet the AGCM concerns, the App distributors presented specific commitments in order to remove any misleading features. In particular, they committed to remove the “free” claim from the online store and to specify whether the Apps contain in-app purchases. The AGCM accepted the commitments and made them binding for the challenged App distributors without further reviewing the alleged infringement.
The AGCM investigation is not at all surprising as it follows the concerns raised by the EU Commission last year. In fact, as you can see here, in June 2014 the Commission stated that “following a large number of complaints in EU countries concerning in-app purchases in online games and in particular inadvertent purchases by children, national authorities joined forces with the European Commission to find solutions“. Following such statement, the EU Commission requested the App industry to provide solutions able to protect users and to guarantee compliance with the consumer legislation and in particular adequately protect children.
And game Apps have been scrutinized lately not only under a consumer protection standpoint, but also from a privacy law point of view as you can see from the post of our colleagues here.
Apps are then the users worst enemy? Not at all! There is no doubt that Apps will be exponentially used in our everyday life. However both distributors and developers shall bear in mind that both consumer protection and data protection issues shall be carefully considered when implementing and/or advertising Apps, especially when the Apps are addressed to children.