The European Commission today opened 3 formal antitrust investigation cases against Apple. The European Commission is assessing Apple’s conduct in connection with Apple Pay, and if Apple’s rules for app developers on the distribution of apps via the App Store violate EU competition rules.
The European Commission said that following a preliminary investigation, the Commission has concerns that Apple Pay is the only mobile payment solution that may access the NFC “tap and go” technology embedded on iOS mobile devices for payments in stores, and it will investigate the possible impact of Apple’s practices on competition, in providing mobile payments solutions.
The number of the case is AT.40452 (Apple – Mobile Payments – Apple Pay). There are no deadlines for the investigation.
According the European Commission, the investigations about the App Store concern the mandatory use of Apple’s own proprietary in-app purchase system and restrictions on the ability of developers to inform iPhone and iPad users of alternative cheaper purchasing possibilities outside of apps.
“We need to ensure that Apple’s rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books. I have therefore decided to take a close look at Apple’s App Store rules and their compliance with EU competition rule,” said Margrethe Vestager, Executive Vice-President of the European Commission, in charge of competition policy.
The investigation on the App Store is a follow-up on separate complaints by Spotify, in 2019, and by an e-book/audiobook distributor, in 2020, on the impact of the App Store rules on competition in music streaming and e-books/audiobooks.
The App Store Tax
Apple charges app developers a 30% commission on all subscription fees through in-app purchases, and has restrictions on the ability of developers to inform users of alternative purchasing possibilities outside of apps.
In 2020, Apple said it paid out $35 billion to developers. CNBC estimates that Apple had total sales of $50 billion just with the App Store.