Apple is facing billions in potential fines as a result of two newly announced antitrust investigations being conducted by the European Union.
The European Commission — the EU’s executive branch — unveiled the far-reaching investigations this morning, in a series of announcements. Leading music streaming service Spotify and Rakuten-owned Kobo each submitted complaints (centering on the Apple App Store) to EU officials, and their qualms spurred one of the inquiries.
For additional background, Spotify formally made its complaint in March 2019, for reasons outlined by CEO Daniel Ek. Apple quickly responded with an extensive defense of its App Store policies.
The European Commission’s first investigation will seek to determine whether Apple’s App Store terms “violate EU competition rules” by requiring companies “that wish to distribute apps to users of Apple devices” to pay a 30 percent commission on digital content, including subscriptions and ebooks.
The European Commission will also examine potential EU rule violations stemming from Apple’s rules against allowing users to access more affordable purchasing options outside the App Store.
The second investigation is similar in nature to the first – relating to possible EU competition rule infractions – but focuses chiefly on Apple Pay and, specifically, the European Union’s concern that the service “may distort competition and reduce choice and innovation” in the market.
Unlike the first inquiry, however, the latter resulted from a preliminary investigation conducted by EU higher-ups. If the EU finds that Apple violated its anti-competition statutes, the Cupertino, California-based brand could face billions in fines.
The European Union fined Google a record $5 billion in 2018, for a variety of alleged competition rule violations concerning the installation and use of Google assets on Android devices. Google is appealing the penalty, as well as two others, totaling roughly $9 billion.
The European Commission is expected to levy antitrust complaints against online shopping giant Amazon as early as next week, according to reports.