Earlier quoted context omitted.
No, they are punishing because the ATT pop-up is not enough to comply with privacy rules, requiring 3rd party apps to have a secondary pop-up to be compliant (which Apple's own apps wouldn't need since they don't use ATT). So it's more that Apple's ATT is not compliant with stricter privacy rules, not the opposite...
The "stricter" privacy rules of "Accept all" banners that send your data to 1000+ companies? Or "Accept all", but to Refuse you must tap a small grey link and manually uncheck dozens of boxes? Or worse, banners that force you to choose between accepting all tracking or paying a monthly subscription, blatantly illegal in the EU but ubiquitous in Italy even among large companies and news sites? Meanwhile ATT blocks acc…
I don't know, I just stated what is in the decision: Apple makes 3rd party developers have to go through a process their own apps do not have to, hence creating an imbalance in competition since they are also the owners and controllers of the distribution channel.
The blatantly illegal pop-ups also annoy me a lot, it's clear it's not even malicious compliance but a targeted attack against the regulations to make it seem the law is requiring them to make it as annoying as possible. It seems to work since you got incensed by it.