Apple Has Broken the EU Competition Laws, Reveals Preliminary Ruling

Today, the European Commission has issued a "Argument of Objections" against Apple tree. This is happening nearly two years afterward Spotify filed an antitrust complaint with the European Marriage, raising concerns over the "Apple Tax." European Committee's preliminary decision suggests that Apple is finding itself in breach of the Eu competition law.

Apple May Have to Pay a Massive Fine if It Is Plant Guilty

The Argument of Objections is raising issues confronting the imposition of Apple'due south own in-app purchase system that is on all third-party music streaming apps that are distributed via the App Store. A preliminary investigation by the European union has found that most all music streaming services have to go through the 30% commission that Apple takes on purchases made through the organisation to end-user. This has resulted in higher in-app music subscription prices. The EU is also concerned that Apple is enforcing restrictions on app developers, and these restrictions prevent them from informing the users about culling purchasing options.

However, Apple has responded to the findings of the European Commission and issued this statement to The Verge.

Spotify has become the largest music subscription service in the world, and nosotros're proud for the role we played in that. Spotify does not pay Apple any commission on over 99% of their subscribers, and just pays a 15% commission on those remaining subscribers that they acquired through the App Store. At the core of this case is Spotify'southward demand they should be able to advertise alternative deals on their iOS app, a exercise that no store in the globe allows. Once once more, they want all the benefits of the App Shop but don't think they should take to pay annihilation for that. The Commission'due south statement on Spotify's behalf is the opposite of fair competition.

The European Committee believes that Apple's rules on the App Store "distort competition in the marketplace for music streaming services by raising costs of competing music streaming app developers."

In the end, if Apple tree is establish guilty of abusing the dominant market position nether Article 102 of the Treaty on the Performance of the European Spousal relationship (TFEU), the Cupertino behemothic will accept to pay 10% of its annual revenue as a fine, which would be effectually $27 billion. Apple tree has to respond to the European Commission'due south preliminary charges within 12 weeks.