European Union Slaps Apple with Fresh Antitrust Allegations Over Alleged Anticompetitive Conduct Pertaining to its App Store


As I’ve covered repeatedly in this blog, tech giants such as Apple and Google are facing heightened antitrust scrutiny here at home.  But such scrutiny also extends well beyond our borders, and a strong argument can be made that European regulators have taken antitrust regulation of the technology sector even more seriously than their counterparts in the United States.  This is evident from the recent “Statement of Objections” that the European Commission sent Apple on April 30, 2021 concerning Apple’s App Store and its treatment of music streaming apps.  

According to the European Commission’s press release, the Statement of Objections “follows-up on a complaint by Spotify,” a streaming competitor to Apple Music, both of which are sold through the App Store.  The press release notes that a “Statement of Objections is a formal step in Commission investigations into suspected violations of EU antitrust rules.”   

The European Commission is taking issue with two rules that Apple imposes on music streaming apps.  First, Apple requires end-users to use Apple’s in-app purchase system (“IAP”) to acquire digital content.  Apple charges app developers a 30% commission fee on all subscriptions bought through the mandatory IAP and “[t]he Commission’s investigation showed that most streaming providers passed this fee on to end users by raising prices.”  Second, Apple uses “Anti-steering provisions” which limit the ability of app developers to inform users of alternative purchasing possibilities outside of apps, which are usually cheaper.  The end result is that “users of Apple devices pay significantly higher prices for their music subscription services or they are prevented from buying certain subscriptions directly in their apps.”  

If proven, the European Commission asserts that Apple’s conduct infringes Article 102 of the Treaty on the Functioning of the European Union (TFEU) that prohibits the abuse of a dominant market position.  According to the press release, Apple may now “reply in writing and request an oral hearing to present their comments on the case before representatives of the Commission and national competition authorities.”  
 

About Faruqi & Faruqi, LLP

Faruqi & Faruqi, LLP focuses on complex civil litigation, including securities, antitrust, wage and hour, personal injury and consumer class actions as well as shareholder derivative and merger and transactional litigation. The firm is headquartered in New York, and maintains offices in California, Delaware, Georgia and Pennsylvania.

Since its founding in 1995, Faruqi & Faruqi, LLP has served as lead or co-lead counsel in numerous high-profile cases which ultimately provided significant recoveries to investors, direct purchasers, consumers and employees.

To schedule a free consultation with our attorneys and to learn more about your legal rights, call our offices today at (877) 247-4292 or (212) 983-9330.

About David Calvello

David Calvello is an Associate in Faruqi & Faruqi, LLP’s New York office. He mainly practices in the area of antitrust litigation with a focus on competition in the pharmaceutical industry. In law school, David was an editor for the Pace International Law Review and competed in the Willem C. Vis International Commercial Arbitration Moot in Vienna, Austria.

Tags: faruqi & faruqi, investigation, news, litigation, settlement notice, case, faruqi law, faruqi blog, faruqilaw, David Cavello, antitrust litigation David Calvello David Calvello
Senior Associate at Faruqi & Faruqi, LLP

New York office
Tel: (212) 983-9330
Fax: (212) 983-9331
E-mail: dcalvello@faruqilaw.com
Social: LinkedIn

Finding us

Our Offices


Our offices are nationwide. If you have any questions about a case or our firm, please contact us.

New York

685 Third Avenue 26th Floor
New York, New York 10017
(212) 983-9330
(877) 247-4292
(212) 983-9331

California

10866 Wilshire Boulevard Suite 1470
Los Angeles, California 90024
(424) 256-2884
(424) 256-2885

Delaware

3828 Kennett Pike Suite 201
Wilmington, Delaware 19807
(302) 482-3182
(302) 482-3612

Georgia

3975 Roswell Rd Suite A
Atlanta, Georgia 30342
(404) 847-0617
(404) 506-9534

Pennsylvania

1617 JFK Boulevard, Suite 1550
Philadelphia, Pennsylvania 19103
(215) 277-5770
(215) 277-5771

Faruqi & Faruqi office in New York, New York

Faruqi & Faruqi office in Los Angeles, California

Faruqi & Faruqi office in Wilmington, Delaware

Faruqi & Faruqi office in Atlanta, Georgia

Faruqi & Faruqi office in Philadelphia, Pennsylvania