The European Union is set to charge Apple this week with anticompetitive behavior linked to a complaint from Spotify about App Store rules, according to reports.
If the reports come true and EU regulators press antitrust charges against Apple
it would represent the first time the technology giant has faced such charges in the 27-member bloc, as competition concerns stack up worldwide.
Music streaming platform Spotify alleged in March 2019 that Apple abused its control over which apps appear in the App Store to restrict competition against its own Apple Music service. Spotify
also said that Apple’s payment system, Apple Pay, which typically takes a 30% cut of transactions, made it difficult for Apple Music rivals to market themselves.
EU regulators later opened antitrust probes into Apple in June 2020, investigating the App Store and Apple Pay.
Margrethe Vestager, the EU’s chief for both competition and digital policy, will issue the charges publicly later this week, the Financial Times reported on Tuesday, with Bloomberg similarly reporting that the charges are due as soon as this week.
In the U.K., the Competition and Markets Authority said in March that it was looking into Apple for suspected breaches of competition rules on the App Store, in a similar case to the one in the EU.
Apple didn’t immediately respond to a request for comment. In 2019, it issued a response to Spotify’s complaint outlining, among other things, how the App Store has facilitated hundreds of millions of downloads of the Spotify app. “Spotify wraps its financial motivations in misleading rhetoric about who we are,” Apple said in 2019.
Charges from the EU could be a step toward introducing significant fines or mandating changes to the App Store or Apple Pay. Fines for breaking EU competition law are capped at 10% of the overall annual turnover of a company, though it is unlikely Apple would face the full brunt of that punishment. The company would also have the opportunity to make its case against regulators before a decision is handed down.
Charges against Apple in the EU would represent the latest in a number of antitrust challenged facing the company globally, and would mark a major step in the global push among regulators to rein in the power of Big Tech.
On Monday, a group of Germany’s largest and most powerful media and advertising companies filed an antitrust complaint against Apple with the Bundeskartellamt, the country’s Federal Cartel Office.
The complainants, which include associations in the media and communications and members of the German Advertising Federation, allege that Apple abuses its market power and violates antitrust law through new changes to iPhone privacy settings.
Big Tech more broadly faces landmark regulation in the EU that includes the possibility of multibillion-dollar fines and the breaking up of companies if they don’t comply with new rules.
Apple, as well as online retailer Amazon
social media platform Facebook
and tech giant Google, owned by Alphabet
will fall under the Digital Services Act and Digital Markets Act, presented by the European Commission in December 2020 and pending approval by the European Parliament and Council of Ministers. These acts aim to hold tech platforms to a high standard over the content they host, and introduce new procompetition measures for online markets.