The European Commission is reportedly preparing to levy a fine of around 500 million euros ($539 million) against Apple for alleged breaches of EU competition law, according to sources familiar with the matter as reported by the Financial Times on Sunday.
The investigation stems from complaints raised by Spotify in 2019, accusing Apple of impeding third-party music services on its devices while promoting its own Apple Music service.
One key issue revolves around Apple’s App Store rules, which typically prevent companies like Spotify from directly billing users for subscriptions within their apps, instead requiring the use of Apple’s billing service and taking a cut of up to 30%.
Brussels formally charged Apple in an antitrust probe in 2021, initially focusing on allegations of compelling developers to use its in-app payment system.
However, the investigation’s scope was later narrowed, focusing on whether Apple restricted apps from informing users about cheaper subscription options outside of the App Store.
The European Commission is expected to accuse Apple of abusing its dominant position and enforcing “unfair trading conditions” regarding its music service subscription policies.
If imposed, this fine would be one of the largest penalties the EU has imposed on a major tech company, following similar actions against Google.
This development comes amidst broader regulatory efforts in the EU, particularly ahead of the Digital Markets Act’s enactment in March.
The legislation aims to address anti-competitive practices by tech “gatekeepers” like Apple, Amazon, and Google, allowing third-party developers more freedom in distributing apps and billing customers directly.
Apple has responded to EU regulations by announcing changes to its iOS, Safari, and App Store practices in the EU, including allowing software developers to distribute apps through alternative stores.
However, the tech giant remains under scrutiny, with the European Commission also investigating Apple’s restrictions on rivals accessing its Apple Pay mobile system.
While the timing of the Commission’s announcement on fines remains uncertain, Apple retains the right to appeal the decision in EU courts.
The company declined to comment specifically on the reported fine, referring to a previous statement expressing satisfaction with the narrowed focus of the probe.
Source-CNBC
