Apple's App Store, Apple Pay targeted by EU antitrust regulators

[June 16, 2020] By Foo Yun Chee

BRUSSELS (Reuters) - Apple on Tuesday found itself the target of two EU antitrust investigations into its App Store and Apple Pay as the bloc turned up the heat on online gatekeepers over alleged anti-competitive business practices aimed at blocking rivals.

European Commissioner Executive Vice-President Margrethe Vestager speaks during a news conference about the Solvency Support Instrument at EU headquarters in Brussels, Belgium May 29, 2020. Olivier Matthys/File Photo

The European Commission said one investigation would look into the mandatory use of Apple's proprietary in-app purchase system and rules preventing app developers from informing iPhone and iPad users of cheaper options elsewhere.

The case followed a complaint from Swedish music streaming service Spotify <SPOT.N> last year, which said Apple was unfairly restricting rivals to its own music steaming service Apple Music. Another gripe was the 30% fee levied on app developers.

Spotify welcomed the EU probe, saying it hoped regulators would treat the case with urgency. A smaller rival filed a similar grievance related to e-books and audiobooks in March this year.

"It appears that Apple obtained a 'gatekeeper' role when it comes to the distribution of apps and content to users of Apple's popular devices," European Competition Commissioner Margrethe Vestager said in a statement.

The second case focuses on Apple's terms and conditions on how its mobile payment service Apple Pay should be used in merchants' apps and websites, and also the company's refusal to allow rivals access to the payment system.

Regulators are also concerned that Apple Pay, launched in 2014 as the company diversified from sales of devices like iPhones and iPads, is the only mobile payment service allowed to use the "tap and go" functionality on iPhones.

Apple was critical of the EU investigations.

"It's disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don't want to play by the same rules as everyone else," the iPhone maker said in a statement.

"We don't think that's right — we want to maintain a level playing field where anyone with determination and a great idea can succeed."

(This story refiles to remove extraneous text in advisory line which should read: Adds Apple comment)

(Reporting by Foo Yun Chee; Editing by Philip Blenkinsop/Jan Harvey/Jane Merriman)

[© 2020 Thomson Reuters. All rights reserved.]

Copyright 2020 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.