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Apple is facing a potential $39.4 billion fine from the European Union (EU) after the European Commission announced it had issued a Statement of Objections against the company over concerns regarding its App Store rules for music streaming services that compete against Apple Music. The Commission is alleging that “Apple’s anti-steering obligations are unfair trading conditions in breach of Article 102 of the Treaty on the Functioning of the European Union”.
The EU is concerned that Apple’s “anti-steering obligations” prevent music streaming app developers from informing consumers about where and how to subscribe to streaming services at lower prices. The EU alleges that Apple has breached antitrust laws relating to restrictions imposed by Apple on developers advertising subscriptions through the App Store.
The EU’s investigation into Apple’s rules for app developers on the distribution of apps via the App Store began in June 2020 when the Commission opened formal proceedings. In April 2021, the Commission sent Apple a Statement of Objections, to which Apple responded in September 2021. Today’s Statement of Objections replaces the 2021 Statement of Objections by clarifying the Commission’s objections against Apple.
In a Statement of Objections, the EU informs Apple in writing of the objections raised against them. Apple can now examine the documents in the Commission’s investigation file, reply in writing, and request an oral hearing to present their comments on the case before representatives of the Commission and national competition authorities.
This is not the first time that Apple has faced criticism over its App Store rules. The company has been accused of anti-competitive behavior in the past, with developers alleging that Apple’s strict rules and fees limit their ability to compete with Apple’s own services.
The EU’s investigation into Apple’s App Store rules for music streaming services highlights the ongoing debate around the power of tech giants in the digital marketplace. The case is likely to be closely watched by other regulators around the world, as they consider their own approach to regulating the tech industry.
