On Friday, the Competition Commission of India (CCI) ordered a thorough investigation into Apple alleged unfair business practises in its App Store.
Apple is accused of using anti-competitive constraints and dominating practises in the marketplaces for the distribution of applications (apps) to consumers, as well as the payment processing for digital content utilised within iOS mobile apps.
Apple Inc. and Apple India Pvt Ltd were named in the lawsuit.
The watchdog stated in a 20-page judgement 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.
“Furthermore, third-party app stores are not allowed to be listed on Apple’s App Store because the developer guidelines and agreement prohibit app developers from offering such services… these restrictions imposed by Apple foreclose the market for app stores for iOS for potential app distributors,” according to the order.
According to the CCI, this prima facie results in the potential app distributors/app store developers being denied market access, which is a violation of competition rules.Furthermore, such methods appear to impede or restrict the technical or scientific development of services connected to the iOS app store, owing to less pressure on Apple to continuously innovate and improve its own app store, which is also in breach of competition regulations, according to the judgement.The agency has ordered a thorough investigation by its Director General, citing these factors (DG).Apple did not respond to a request for comment on the CCI investigation.The CCI has chosen the’market for app stores for iOS in India’ as the relevant one to analyse the complaint.
App developers tend to be reliant on Apple’s App Store to reach app consumers, and app users appear to be reliant on the App Store to download apps, according to the watchdog.”As a result, the Commission believes that Apple has a dominant position in the relevant market for iOS app stores in India. This reliance appears to result in app creators accepting Apple’s required and non-negotiable restrictions, including those relating to app distribution through the App Store “According to the order.
Apple conditions the provision of app distribution services on the app developer adopting supplemental duties that, by their nature or according to commercial usage, have no connection with the topic of the contract for provision of distribution services, according to the watchdog.
“This looks to be in breach of the Act’s Section 4(2)(d). Furthermore, it appears to result in Apple using its dominant position in the App Store to enter/protect its market for in-app purchase payment processing, in contravention of Section 4(2)(e) of the Act “According to the order.Abuse of a dominant position is covered by Section 4(2) of the Competition Act.The order stated that the “Commission is of the view that Apple’s approach is completely misdirected as the alleged anti-competitive restrictions, in the present matter, have been imposed on the app developers in the form of App Store policies, by Apple,” in response to Apple’s claims that it has a market share of 0-5 percent.
In other words, the CCI stated that the current case involves a claim of Apple abusing its influence over app developers.
“As a result, it appears at this time that the relevant market must be characterised from the standpoint of app developers rather than from the perspective of end users,” the order stated.Apple claims that the complainant is likely acting in collaboration with parties with whom it has ongoing commercial and contractual disputes around the world and/or who have filed complaints with other regulatory bodies.Furthermore, the company warned the regulator that it should be aware of individuals who use proxy parties as a front for coming forward in their own name.
According to CCI, the informant has a limited role under the current statutory framework, and the proceedings before the Commission are solely governed by the merits of the case under the Act’s provisions. “The Commission would intervene only if the situation merited review under the Act’s relevant provisions.”
Together We Fight Society, a non-profit organisation, filed the complaint. PTI RAM MBI ANU ANU
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