Apple has launched a legal challenge against a 1.8 billion euro ($1.95 billion) fine imposed by the European Commission for breaching competition law and unfairly favoring its own music streaming service over rivals including Spotify .
According to court filings, the US tech giant filed an appeal at the EU's General Court based in Luxembourg earlier this month.
Details of what is contained in the legal action, listed as: “Apple and Apple Distribution International v. Commission,” are not yet publicly available. Representatives for Apple and the European Commission did not respond to requests for comment.
Apple previously said it would appeal the EU fine, which was imposed in March after a long-running investigation sparked by complaints from Swedish streaming service Spotify.
At the time of the decision, the European Commission Margrethe Vestager said Apple had “abused its dominant position” for nearly a decade by restricting rival music streaming apps from telling consumers about alternative, cheaper music services available outside the App Store.
As a result, many users paid “significantly higher prices for music streaming subscriptions” because of the high fee Apple charged developers, which was then passed on to users, the Commission said.
Apple has always vehemently denied these claims, arguing that EU investigators had not “uncovered any credible evidence of consumer harm”. The commission's decision “ignores the reality of a market that is thriving, competitive and growing rapidly,” the tech company said in a statement two months ago.
The nearly $2 billion fine was imposed as part of an ongoing EU-wide effort to curb the global dominance of big tech companies through major financial penalties and regulatory measures.
In March, just days after Apple received the penalty notice, new EU rules governing how Europe's biggest online platforms operate came into effect as part of the Digital Marketing Act (DMA).
The DMA requires the six tech giants designated as “gatekeepers” by the European Commission — Apple, Google parent Alphabet, Amazon, ByteDance, TikTok owner Meta, and Microsoft — to comply with a number of provisions, including disfavor internal services at the expense of third party providers.
The laws are enforced with fines of up to 20% of total global turnover (aka gross revenue) or, in extreme cases, with the “last resort” of forced divestitures and dissolution of businesses.
In response, companies such as Apple have overhauled the way they operate in the 27-member EU bloc, allowing European users to download competing app stores and reducing fees charged to developers for purchases made through the App Store.
However, Apple's plans to charge “high-volume” services with more than 1 million users a €0.50 ($0.54) “basic technology fee” per download, per year, to use alternatives to the App Store has been heavily criticized from several European companies, including Spotify and Deezer.
On March 25, the EU announced that it was investigating Apple, along with Meta and Alphabet, for possible violations and non-compliance with the terms of the DMA.
Apple's legal challenge to the Commission's $1.95 billion fine opens yet another battlefront with EU regulators. The tech company has previously had some success at the General Court — the European Union's second-highest court, which hears cases brought by companies against the Commission.
In 2020, EU judges overturned an earlier Commission ruling that Apple owed €13 billion in taxes to the Irish government. This case then went to the European Court of Justice and continues to slowly move through the legal process.
Apple's latest legal battle could be just as lengthy and last several years before any decision is made by the General Court, which will also be open to appeal.
from our partners at https://www.billboard.com/business/legal/apple-appeals-european-commission-fine-competition-laws-1235690736/
