EU investigation into Apple no longer revolves around in-app payment systems
The European Commission has dropped its complaint that Apple is distorting competition with its in-app payment system. Instead, the investigation focuses on Apple prohibiting developers from informing customers how to purchase subscriptions outside of the App Store.
The European Commission now says it will no longer ‘take a position’ when it comes to the legality of Apple’s obligation to use in-app payment systems. The Commission therefore does not say that this is permitted, only that the current investigation no longer focuses on it. In April 2021, the Commission still said that this was anti-competitive behavior, after which Apple responded. It is not clear whether this reaction played a role in the Commission’s decision to drop this part of the complaint.
The Commission says it will focus on another part of its anti-competitive complaint, namely that Apple prohibits app developers from informing customers about purchasing subscriptions outside the app or App Store. Often such subscriptions to, for example, a developer’s website are cheaper, because the developer does not have to pay a commission to Apple.
According to the Commission, this prohibition is an unfair trading condition and contrary to Article 102 of the Treaty on the Functioning of the European Union. The ban, according to the Commission, is ‘necessary or proportionate’, disadvantages users of music streaming services on Apple’s devices and negatively affects developers of streaming apps.
Now that the Commission has strengthened its complaint, Apple may respond again and request a hearing with the Commission and national regulators. The Committee emphasizes that the tightened complaint is not yet a final judgement. If Apple fails to successfully convince the Commission of its innocence, the company could be fined up to 10 percent of its annual worldwide turnover. The Commission says it has no deadline and does not indicate when the investigation can be completed.
The European Commission’s investigation began after Spotify filed a complaint in March 2019. The company said, among other things, that Apple worked with unfair conditions. European Commissioner Margrethe Vestager would have previously expressed her frustrations about the slow progress of the investigation into Apple. Incidentally, since September 2021, app makers have been allowed to add links to external websites in their apps where customers can take out subscriptions without Apple’s payment systems. This followed a ruling by a Japanese market regulator.