Apple could be set to face a massive fine of around $539 million (€500m) from the European Union over alleged breaches of its competition laws.
As reported by the Financial Times, the issue stems from an antitrust complaint filed by Spotify in 2019, relating to Apple’s anti-competitive App Store functions which hindered third-party music streaming services on its devices.
The App Store rules, at that time, made it difficult for developers to direct users to alternative subscription models outside the app, which presented a possible saving of the 30% fee applied by the Cupertino-based tech giant.
Sources close to the story indicated to the FT a significant fine is incoming with the European Commission set to present its findings. It is part of the executive body of the EU, which carries the remit to ensure legislation is properly applied within the bloc.
It has been reported it will state Apple has broken EU antitrust laws, enabling “unfair trading conditions” for its rivals with the App Store’s “anti-steering obligations.”
Apple’s ongoing issue with EU
The company was formally charged in 2021, under another anti-competitive investigation, but it benefited from a reduced scale of the probe last year as the EU discounted a charge of pushing developers to use its own in-app payment system.
The report further indicated Apple will be hit with a ban on its “unfair trading conditions” in what would be one of the most severe penalties to be meted out to a major tech company. The maker of the iconic iPhone was slapped with a landmark €1.1 billion antitrust sanction by the French authorities in 2020, but this was later reduced to €372 million on appeal.
It has the right to appeal any upcoming fine in the EU courts but the response to this case will be interesting, given the relevance of the Digital Markets Act rules, set to apply from the beginning of March.
This incoming legislation will allow third-party developers to distribute their apps outside the confines of the iOS store with the functionality. to directly bill customers for services rendered.
