Russia’s FAS Found Apple Violating Antitrust Laws

Digital Markets
Russia’s FAS Found Apple Violating Antitrust Laws
Photo: unsplash.com 19.07.2022 345

The company abused its dominant position in the market of distribution of iOS applications, the Federal antimonopoly service (FAS) said. 

"Today, the FAS Commission of Russia found Apple guilty of abusing its dominant position in the market for distribution of iOS applications. The size of a turnover-based fine against the company will be determined during the course of an administrative investigation,"

 the agency said in a press release

In October 2021, Russia’s FAS initiated an antitrust case against Apple.

It was found that Clause 3.1 of the AppStore Review Guidelines prohibits iOS app developers from informing customers about the ability to pay for purchases outside of the AppStore, as well as from using alternative payment methods.

The company requires developers to remove links to their online resources and modify the functionality of the app so that the sign-up form does not lead to external sites. Otherwise, the company doesn't allow the application in the App Store.

The FAS came to the conclusion that by those actions Apple abused its dominant position in the market of distribution of apps for iOS. Antitrust agency  issued a warning to the company to eliminate violations.

Apple didn't fulfill the warning, so the service initiated a case on violation of the antimonopoly law.

Last September, South Korea became the first country to legally restrict techno-giants' anti-competitive bans on the use of third-party payment systems in their app stores, points out Mikhail Shikhmuradov, an expert at the BRICS Competition Centre. 

Examples from South Korea and Russia's FAS reflect a broader trend toward increased regulation of companies that use digital platforms and are criticized for having too much power, the expert says. 

"For example, for a long time, Apple and Google's policies included a 30% commission on each payment in app stores. And while, due to criticism, Apple has reduced the commission to 15% for developers with less than $1 million a year in revenue, the situation with app stores is not as straightforward."

Mikhail Shikhmuradov reminds about the case of Epic Games against Apple, which was also decided in September last year. Then the court did not agree that Apple had violated the antitrust prohibitions by refusing to mention third-party payment systems, but ruled that there was a violation of the California Unfair Competition Law (UCL). 

The case of the FAS against Apple echoes the European Commission's high-profile pursuit of Apple for what it has called a "closed ecosystem" that "unfairly shielded" Apple from competition, Reuters notes.

digital markets  Russia 

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