Business Maverick

Business Maverick

EU’s Apple Probes Press Ahead as Epic Trial Plays Out in U.S.

An Apple Inc. logo is displayed outside the company's store at Yorkdale mall in Toronto, Ontario, Canada, on Thursday, Aug. 22, 2019. Statistics Canada (STCA) is scheduled to release consumer price index data on September 18. Photographer: Brent Lewin/Bloomberg

The European Union is pressing ahead with its Apple Inc. probes undistracted by allegations of anti-competitive behavior by the tech giant playing out in a Californian courtroom, according to the bloc’s antitrust chief.

The investigation into Apple Pay is “quite advanced” and European regulators need to “do our own thing” regardless of what happens in the U.S. suit against Epic Games Inc., Margrethe Vestager said in an interview with Bloomberg News.

Epic-Apple Judge Floats Compromise to Resolve App Store Feud

Apple Chief Executive Officer, Tim Cook, is slated to testify as soon as this week in the high-stakes trial with Epic Games, which could upend the multibillion-dollar marketplace for apps which run on mobile phones around the world

“We’re following that very closely,” because of the Epic complaint filed in the EU in February and the bloc’s digital rules that could require phones to allow a rival app store, which Apple does not allow, she said.

The European Commission is building a second antitrust probe into Apple Pay, after it last month escalated an investigation into how Apple requires app developers to use its in-app purchasing system.

“We would have to do our own thing no matter the outcome of the U.S. casework,” she said, pointing to the differences between EU and U.S. antitrust law and markets.

Apple Pay is the only mobile payment solution that can use the iPhone’s near-field communications “tap and go” functionality to make contactless payments. British and Dutch competition authorities are also examining Apple Pay.

“The case is in itself is something that we’re pushing forward,” Vestager said. “I think that is quite advanced.”

While the EU is weighing potential rules over how phones should grant access to rival payment providers, she sees a need for more urgent action from antitrust enforcers.

“Legislation also takes a long time and a lot can happen in the market in the meantime if we don’t investigate,” she said.

Epic is one of many developers that have accused the iPhone maker of locking developers in its App Store by onerous contractual obligations. Apple has rebuffed the allegations saying its iPhone payment system keeps customers secure.

The Cupertino, California-based company’s regulatory woes have intensified in recent months as software firms lined up to criticize the levies Apple and Alphabet Inc.’s Google charge outside developers for using their digital distribution platforms.

Apple declined to comment on Vestager’s remarks. The company said last month that developers “want all the benefits of the App Store but don’t think they should have to pay anything for that.”

Apple already reacted last year by halving the fees it charges to most developers who sell software and services on the App Store.

It lowered a fee to 15% from 30% for developers who generate as much as $1 million in yearly revenue from their apps and those who are new to the store. Apple says many apps pay no fees in return for the company’s efforts to host and maintain the security of the store.


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