The UK Competition Appeal Tribunal (CAT) recently ruled that Apple’s charging commissions of up to 30% on app developers in the App Store constituted an abuse of its dominant market position, and determined that its behavior was unfair and excessive. The ruling is a class action lawsuit against about 20 million iPhone and iPad users in the UK, with potential damages of up to 1.5 billion pounds (about 2 billion U.S. dollars).
The case was led by British scholar Dr. Rachael Kent. The plaintiff believed that Apple constituted a "100% monopoly" on the iOS platform by exercising strict control over the App Store and in-app purchases. The Competition Appeal Tribunal found that Apple's commission policy did hinder competition in the app distribution market and brought "huge profits" to the company, but harmed the interests of developers and consumers. Member users were found to be entitled to compensation, with the specific amount to be determined at a subsequent hearing.
In the past few years, Apple’s “30% tax” has been criticized by developers as a monopoly and too high. Although Apple has currently adjusted its commission policy, it still faces legal challenges in the United States and the European Union. In response, an Apple spokesperson said that the company would appeal and denied the ruling, believing that it held a wrong view of the "vibrantly competitive app ecosystem." Apple emphasizes that the App Store can provide consumers and developers with a secure and innovative platform that protects privacy. The company also points out that 85% of developers pay no commission and that the services and fees are reasonable.
If it ultimately loses the case, Apple may face billions of dollars in damages in the UK alone, and similar cases around the world may continue to pressure Apple to review its App Store charging model.