Reuters: EU to sue Apple for violating antitrust rules with App Store
The European Commission has almost finished its antitrust investigation into Apple and will sue the company for violating these rules. Apple may receive the lawsuit before the summer. Spotify complained to the EU in early 2019 about the alleged unfair situation within the App Store.
Two sources tell Reuters that the European Commission is now finalizing the letter of indictment. One of those sources says the letter may go to Apple before the summer. The sources have not yet provided details about the contents of the letter. In the letter of indictment, the European Commission writes which rules Apple has broken and what the consequences are. Normally this concerns a fine and the European Commission indicates what the company should stop doing.
The European Commission launched an abuse of power investigation into Apple in June last year. This investigation is about the alleged abuse of power in the App Store. Spotify complained to the European Commission in early 2019 about the ‘unfair’ terms of the app store. Apps that provide digital services, such as Spotify, must remit thirty percent of the revenue they earn through Apple’s payment system to the Californian company. Apps such as Uber and Deliveroo do not have to pay that thirty percent, which is unfair according to Spotify.
In addition, the music streaming service calls it unfair that Apple is both a provider of the App Store and a developer of competitor Apple Music. As a result, Apple would penalize services that compete with Music. Apple again states that Spotify wants to use the benefits of the App Store, without wanting to pay for it. According to Apple, the advantages are the platform, the development tools and the payment environment.
If Apple is fined, it could theoretically amount to ten percent of its annual turnover. There are currently three other European competition investigations into Apple. These include the restrictions that Apple imposes on the NFC chips in iPhones and the fact that app developers are not allowed to advertise with cheaper alternatives to the in-app purchases. For example, Spotify is not allowed to tell customers that a subscription taken out via the Spotify site is cheaper than one taken out via the iOS app.