Apple has lost a landmark antitrust lawsuit in the United Kingdom, with the Competition Appeal Tribunal (CAT) ruling that the company abused its dominant position by charging app developers excessive and unfair fees on App Store purchases. The decision marks a major setback for Apple’s business model in one of its most closely scrutinized markets.
According to the Tribunal, Apple overcharged developers between 2015 and 2020 by forcing them to use its in-app payment system and pay commissions of up to 30%. These fees, the court found, led to inflated app prices that were ultimately passed on to consumers. The ruling described Apple’s control over iOS app distribution as “near absolute market power,” rejecting the company’s argument that Android and other platforms provided sufficient competition.
The case was brought in 2021 by King’s College London lecturer Dr. Rachael Kent, representing nearly 20 million iPhone and iPad users in the UK. The claim seeks up to £1.5 billion in damages, which could amount to about £75 per user if approved. Lawyers representing the claimant group said that users could expect “significant compensation” for years of overcharging on popular apps such as Tinder, Minecraft, Strava, and Clash of Clans.
Apple’s defense maintained that the App Store’s structure benefits both developers and consumers by providing a secure platform for payments and distribution. In a statement, the company said it “strongly disagrees with the ruling, which takes a flawed view of the thriving and competitive app economy,” adding that it intends to appeal. Apple also argued that its fees help fund the infrastructure that ensures privacy, security, and support for developers worldwide.
The period covered by the ruling ends in 2020, when Apple launched the App Store Small Business Program. That initiative halved commissions to 15% for developers earning under $1 million annually and introduced several reforms following global regulatory pressure and lawsuits such as Epic Games v. Apple.
The CAT’s judgment is one of the first mass antitrust lawsuits under the UK’s emerging collective action framework. It comes at a time when Apple faces mounting challenges from regulators in both the US and Europe, particularly under the EU’s Digital Markets Act and the UK’s new competition regime. A separate hearing next month will determine how damages will be calculated and distributed.
Despite the company’s appeal plans, legal experts say this ruling could set an important precedent for how large technology platforms are regulated and held accountable for monopolistic practices in digital marketplaces.
(via Reuters)
