EU To Impose Its First Ever Fine on Apple Inc, of About €500 Mn

A recent report by the Financial Times (FT) said that European Union (EU) is to impose its first ever fine on Apple Inc. for allegedly breaking EU law over access to its music streaming services. EU started investigating Apple Inc in 2020, after Swedish streaming platform Spotify complained, in 2019, that Apple’s policies muted competition against Apple Music.

Citing five people with direct knowledge of this long-running investigation, the FT report said that the fine is in the region of €500 million ( ~ US$ 539 million) and is expected to be announced early next month. The fine, which is yet to be announced officially, is the culmination of a European Commission antitrust probe into whether Apple has used its own platform to favour its services over those of competitors.

The probe is investigating whether Apple blocked apps from informing iPhone users of cheaper alternatives to access music subscriptions outside the App Store. It was launched after music-streaming app Spotify made a formal complaint to EU regulators in 2019.

The FT report further said that the EU commission will ban Apple's practice of blocking music services from letting users outside its App Store switch to cheaper alternatives. Brussels will accuse Apple of abusing its powerful position and imposing anti-competitive trading practices on rivals.

Apple has never been fined for antitrust infringements by Brussels, the administrative centre of the EU. Though in March 2020, France’s competition authority, the Autorité de la Concurrence, has fined Apple €1.1 billion (around $1.2 billion) for illegally restricting how wholesalers sell Apple products. However later in 2022, French authorities dropped that to about $366 million after Apple made an appeal.

In 2021, Brussels formally charged Apple in the anti-competitive probe but last year the commission narrowed the scope of the investigation and abandoned the charge wherein Apple was allegedly pushing developers to use its own in-app payment system.

The tiff between Apple and Spotify isn't new as earlier in July 2015, Spotify launched an email campaign to urge its App Store subscribers to cancel their subscriptions and start new ones through its website, bypassing the 30% transaction fee for in-app purchases required for iOS applications by Apple Inc. Later, Apple responded to this by rejecting Spotify app update on iOS. In the following months, Spotify joined several other companies in filing a letter with the EU's antitrust body indirectly accusing Apple and Google of "abusing their 'privileged position' at the top of the market".

Moreover, Spotify was one of the first companies to support Epic Games in their lawsuit against Apple, which was filed after Epic also tried to bypass Apple's 30% fee for microtransactions in Fortnite. In September 2020, Spotify, Epic, and other companies founded The Coalition for App Fairness, which aims for better conditions for the inclusion of apps in app stores

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