For abusing its dominant market position in the distribution of music streaming applications through the App Store
The European Commission decided today to fine Apple more than €1.8 billion for breaches of EU competition rules in the music streaming market from the App Store.
The Commission’s Vice-President for Competition, Margret Vestager, said: “For a decade, Apple has abused its dominant position in the market to distribute music streaming apps through the App Store. They did this by restricting developers from telling consumers about alternative, cheaper music services available outside of Apple’s ecosystem. This is illegal under EU antitrust rules, so today we fined Apple over €1.8 billion.”
The European Commission has fined Apple more than €1.8 billion for abusing its dominant market position to distribute music streaming apps to iPhone and iPad users (“iOS users”) through its App Store. In particular, the Commission found that Apple imposed restrictions on app developers, preventing them from informing iOS users about alternative and cheaper music subscription services available outside the app (“anti-addressing provisions”). This is illegal under EU antitrust rules.
In determining the amount of the fine, the Commission took into account the duration and seriousness of the infringement, as well as Apple’s total turnover and capitalization. It also took into account that Apple submitted incorrect information as part of the administrative process. In addition, the Commission decided to add to the basic amount of the fine an additional lump sum of €1.8 billion to ensure that the total fine imposed on Apple is sufficiently dissuasive.
The Commission concluded that the total amount of the fine of more than €1.8 billion is proportionate to Apple’s worldwide revenue and is necessary to achieve deterrence. It is noted that in June 2020, the Commission initiated formal proceedings on Apple’s rules for app developers regarding the distribution of apps through the App Store.
Under EU antitrust rules, dominant companies have a particular responsibility not to abuse their strong market position by restricting competition, either in the market in which they hold a dominant position or in separate markets. Fines imposed on companies that break EU antitrust rules are paid into the general EU budget. This revenue is not earmarked for specific expenditure, but member states’ contributions to the EU budget for the following year are reduced accordingly. Fines therefore help to finance the EU and reduce the burden on taxpayers.
