Spain’s competition authority, the Comisión Nacional de los Mercados y la Competencia (CNMC), has initiated an investigation into Apple’s App Store, citing concerns that the tech giant may be imposing unfair trading conditions on developers.
The probe, announced Wednesday, July 24, aims to determine if Apple’s practices are anti-competitive, particularly affecting developers who distribute software to iOS users.
The CNMC’s announcement, translated from Spanish, suggests that Apple may be engaging in actions that restrict fair competition, though specific details of these concerns have not been disclosed.
The investigation could last up to two years, and if the CNMC concludes that Apple has breached competition rules, the company could face a penalty of up to 10% of its global annual turnover, a sum that could reach billions of euros.
Developers have long criticized Apple’s App Store policies. Their complaints include the high fees Apple charges for in-app purchases and the requirement to use Apple’s payment system. Developers have also pointed out issues with the app review process, claiming that Apple’s decisions can be arbitrary and unfair. These complaints have led to broader concerns about how the App Store is managed.
Apple, however, defends its approach, stating that its rules are clear and consistent. The company claims these rules are designed to ensure a safe and high-quality experience for users. Apple also notes that over 90% of the revenue from the App Store goes directly to developers, with Apple not taking any commission on this revenue.
In response to the CNMC investigation, Apple spokesperson Emma Wilson issued a statement affirming the company’s commitment to working with the Spanish Competition Authority to understand and respond to the concerns raised.
Ongoing and Upcoming Legal Challenges
This investigation in Spain adds to a series of legal challenges Apple faces in Europe. Earlier this year, the European Commission fined Apple €1.84 billion for anti-competitive behavior related to music streaming apps.
Additionally, the Commission is investigating whether Apple’s App Store complies with the Digital Markets Act (DMA), a new EU law aimed at ensuring fair competition. The DMA imposes rules on large tech companies and can lead to fines of up to 10% of global revenue for non-compliance.
Last month, the Commission found that Apple’s rules restricting developers from directing users to alternative payment methods might violate the DMA. There is also an ongoing investigation into a new fee called the Core Technology Fee (CTF), which Apple charges developers who accept terms related to DMA entitlements.
Furthermore, the EU is looking into whether Apple is allowing third-party app stores as required by the DMA. Developers argue that Apple makes it difficult for iOS users to access these alternative app stores, which could be against the DMA’s purpose. The Commission will need to decide if Apple’s actions align with the new regulations.
Beyond the EU, the United Kingdom is also planning to introduce new rules to regulate Big Tech companies, which could pose additional challenges for Apple. The growing scrutiny of Apple’s business practices has caught the attention of litigation funders, who are closely watching these developments.
Follow us for more updates on Apple’s legal challenges.