EU investigation into Apple is no longer about 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 banning 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 does not say that this is permitted, only that the current investigation no longer focuses on this. In April 2021, the Commission said that this was anti-competitive behavior, after which Apple responded. It is not clear whether this response 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. Such subscriptions to, for example, a developer’s website are often cheaper, because the developer does not have to pay a commission to Apple.
According to the Commission, this ban is an unfair trading condition and contrary to Article 102 of the Treaty on the Functioning of the European Union. According to the Commission, the ban is ‘not necessary or proportionate’, disadvantages users of music streaming services on Apple’s devices and has a negative impact on 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 Commission emphasizes that the enhanced complaint is not yet a final decision. If Apple does not successfully convince the Commission of its innocence, the company could be fined up to ten 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 is said to have previously expressed her frustrations about the slow progress of the investigation into Apple. Since September 2021, app makers have been allowed to add links in their apps to external websites where customers without Apple’s payment systems can take out subscriptions. This followed a ruling by a Japanese market regulator.