The Competition Commission of India (CCI) on Friday ordered a detailed probe against Apple for alleged unfair business practices concerning its App Store.
“The Commission notes that App Store is the only channel for app developers to distribute their apps to iOS consumers which are pre-installed on every iPhone and iPad. Further, third-party app stores are not allowed to be listed on Apple’s App Store as the developer guidelines as well as agreement prohibits app developers from offering such services. These restrictions imposed by Apple foreclose the market for app stores for iOS for potential app distributors. It prima facie results in denial of market access for the potential app distributors/app store developers in violation of Section 4(2)(c) of the Act,”
The CCI held.
Indian Govt Will Investigate Apple For Unfair Business Practices
The watchdog stated in a 20-page order that Apple’s App Store, which comes pre-installed on every iPhone and iPad, is the sole way for app developers to deliver their programmes to iOS users.
“The resultant market power being enjoyed by Apple due to its grip over iOS ecosystem resulted in ‘allegedly’ high commission fee of up to 30%. This tying of two distinct products (i.e., distribution service and payment processing service for in-app purchases) does not allow the app developers to take the advantage of a competitive payment gateways market. Rather, it creates the conducive condition for expropriation of the app developers as they cannot use alternate payment gateways and negotiate/pay commission at a competitive rate. The alleged high fee charged by Apple is sustained through its imposed tying of distribution service with payment processing service,”
The order said.
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