The EU opened two formal antitrust investigations into Apple on Tuesday. The probes will look into whether the App Store violates the bloc’s antitrust rules and also Apple Pay.
EU Launches App Store Probe
The EU will investigate Apple’s mandatory in-app purchasing system and restrictions on developers informing users about cheaper alternative purchasing options. The EU Commission, the bloc’s executive body, said that following a preliminary investigation it had concerns that restrictions applied by Apple could distort competition between music streaming services. It follows a complaint by Spotify, and also an unnamed e-book and audiobook distributor. That company is understood to be Rakuten offshoot Kobo.
Margrethe Vestager, the EU commissioner in charge of competition policy, said:
Mobile applications have fundamentally changed the way we access content. Apple sets the rules for the distribution of apps to users of iPhones and iPads. It appears that Apple obtained a “gatekeeper” role when it comes to the distribution of apps and content to users of Apple’s popular devices. We need to ensure that Apple’s rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books. I have therefore decided to take a close look at Apple’s App Store rules and their compliance with EU competition rules.
Apple Pay Also Being Investigated
The EU is also launching a probe into whether Apple Pay breaches its rules. It fears Apple Pay dominates the NFC market as rival payment services cannot operate on an iPhone, iPad etc. The investigation is again being led by Ms. Vestager, who said:
Mobile payment solutions are rapidly gaining acceptance among users of mobile devices, facilitating payments both online and in physical stores. This growth is accelerated by the coronavirus crisis, with increasing online payments and contactless payments in stores. It appears that Apple sets the conditions on how Apple Pay should be used in merchants’ apps and websites. It also reserves the “tap and go” functionality of iPhones to Apple Pay.
The lawmaker added that “Iit is important that Apple’s measures do not deny consumers the benefits of new payment technologies, including better choice, quality, innovation and competitive prices. I have therefore decided to take a close look at Apple’s practices regarding Apple Pay and their impact on competition.”