A landmark case in the UK concerning Apple’s App Store practices has just been decided, with a London tribunal ruling against the company in a move that could cost Apple up to $2 billion.

London tribunal rules that Apple overcharged app developers for years with unfair commissions

Sam Tobin writes at Reuters:

Apple abused its dominant position by charging app developers unfair commissions, a London tribunal ruled on Thursday, in a blow which could leave the U.S. tech company on the hook for hundreds of millions of pounds in damages.

The Competition Appeal Tribunal (CAT) ruled against Apple after a trial of the lawsuit, which was brought on behalf of millions of iPhone and iPad users in the United Kingdom.

The CAT ruled that Apple had abused its dominant position from October 2015 until the end of 2020 by shutting out competition in the app distribution market and by “charging excessive and unfair prices” as commission to developers. […]

The case had been valued at around 1.5 billion pounds ($2 billion) by those who brought it. A hearing next month will decide how damages are calculated and Apple’s application for permission to appeal.

Apple has already said it will appeal the ruling, which the company said “takes a flawed view of the thriving and competitive app economy”.

The estimated $2 billion in damages that might be enforced is expected to combine several different factors.

Per Reuters:

• “developers were overcharged by the difference between a 17.5% commission for app purchases and the commission Apple charged, which Kent’s lawyers said was usually 30%.”
• “The CAT also ruled that app developers passed on 50% of the overcharge to consumers.”

We will keep you posted on any further developments with the case, including Apple’s appeal and the actual damages when they are calculated next month.

For previous coverage of this lawsuit, here’s the original 2023 news story.

What are your takeaways from the ruling against Apple for its App Store practices in the UK? Let us know in the comments.

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