Apple loses landmark UK lawsuit over App Store commissions

Tribunal ruled that Apple had abused its ascendant presumption by shutting retired contention and charging excessive prices.

Apple has abused its ascendant presumption by charging app developers unfair commissions, a London tribunal has ruled, successful a stroke that could permission the United States tech institution connected the hook for hundreds of millions of pounds successful damages.

On Thursday, the UK’s Competition Appeal Tribunal (CAT) ruled against Apple aft a proceedings of the lawsuit, which was brought connected behalf of millions of iPhone and iPad users successful the United Kingdom.

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The CAT ruled that Apple had abused its ascendant presumption from October 2015 until the extremity of 2020 by shutting retired contention successful the app organisation marketplace and by “charging excessive and unfair prices” arsenic committee to developers.

Apple – which has faced mounting unit from regulators successful the US and Europe implicit the fees it charges developers – said it would entreaty against the ruling, which it said “takes a flawed presumption of the thriving and competitory app economy”.

The lawsuit had been valued astatine astir 1.5 cardinal pounds ($2bn) by those who brought it. A proceeding adjacent period volition determine however damages are calculated and Apple’s exertion for support to appeal.

Thursday’s ruling comes aft Apple was deed with a complaint to European antitrust regulators over the presumption and conditions of its App Store nether rules aimed astatine reining successful Big Tech.

‘Exorbitant profits’

Rachael Kent, the British world who brought the case, argued Apple had made “exorbitant profits” by excluding each contention for the organisation of apps and in-app purchases.

Her lawyers argued astatine the commencement of the proceedings successful January that Apple’s “100% monopoly position” allowed it to enforce restrictive presumption and excessive commissions connected app developers, which Apple denied.

The CAT said successful its ruling that developers were overcharged by the quality betwixt a 17.5 percent committee for app purchases and the committee Apple charged, which Kent’s lawyers said was usually 30 percent. The CAT besides ruled that app developers passed connected 50 percent of the overcharge to consumers.

“This ruling overlooks however the App Store helps developers win and gives consumers a safe, trusted spot to observe apps and securely marque payments,” an Apple spokesperson said.

Landmark wide lawsuit

The lawsuit was the archetypal wide suit against a tech elephantine to travel to proceedings nether Britain’s fledgling people action-style regime, which this twelvemonth reached its 10th day and has seen respective multibillion-pound cases certified for proceedings but with constricted occurrence for consumers truthful far.

There are, however, galore different cases waiting successful the wings, including 1 against Google implicit the committee it charges app developers for entree to its Play Store.

That lawsuit is owed to statesman successful October 2026 and volition beryllium heard alongside a akin assertion by Epic Games, which is engaged in parallel litigation with Apple successful the US.

Fellow tech giants including Amazon and Microsoft are besides facing sizeable claims astatine the CAT.

Kent said successful a connection that the ruling shows Britain’s corporate enactment authorities is moving and “sends a wide message: nary company, nevertheless affluent oregon powerful, is supra the law”.