Delhi High Court tells Apple to cooperate

Apple has lost, for now, on the question that mattered most in its India antitrust fight: whether it could freeze the case while it attacked the law behind a potential penalty. The Delhi High Court told the company to “fully cooperate” with the Competition Commission of India, or CCI, in the App Store probe and declined to stop the investigation from moving ahead, according to Reuters and Indian press reports. At the same time, the court drew a procedural line by telling the CCI not to issue a final order before July 15, when Apple’s separate challenge to India’s penalty framework is due to be heard. That leaves Apple in a narrower lane. The regulator can keep building the case, seek information and continue hearings, but it cannot yet deliver the final ruling that could trigger a penalty fight. Reuters reported the court also directed Apple to produce financial statements sought by investigators. (money.usnews.com) ### Why was Apple in court if the antitrust case is already underway? Apple’s immediate target was not only the CCI’s App Store investigation but the penalty rules hanging over it. The company has challenged amendments to India’s Competition Act that allow fines to be calculated using global turnover rather than only revenue tied to the business under investigation, according to multiple reports on Apple’s petition. (money.usnews.com) That matters because a global-turnover formula can produce a much larger number for a company with worldwide sales far beyond India’s iPhone app market. Business Standard, citing Apple’s court filing, reported the company said the amended regime could expose it to a penalty of nearly $38 billion. Reuters’ May 18 report referred to Apple’s challenge to the law governing antitrust penalties when describing the court’s refusal to put the case on hold. (economictimes.indiatimes.com) ### What is the CCI actually investigating in the App Store case? The CCI has been examining Apple since 2021 over allegations that it abused a dominant position in the market for app distribution on iOS by requiring developers to use its own in-app purchase system. A Reuters report from July 2024, citing a confidential CCI investigation report, said investigators found Apple had exploited its dominant position in the market for app stores on its iOS operating system and engaged in “abusive conduct and practices.” That report said the case centered on Apple’s requirement that developers use its proprietary in-app purchase system, with fees of up to 30%. (business-standard.com) Apple has previously disputed those allegations. Reuters reported in 2024 that the company argued its market position in India was too small to justify the findings, noting that iPhones accounted for about 3.5% of roughly 690 million smartphones in India at mid-2024, according to Counterpoint Research cited in that report. (hindustantimes.com) ### Why did the court split the difference instead of fully siding with either side? The Delhi High Court appears to have tried to preserve both proceedings at once. Indian press reports said Apple’s lawyers told the court the CCI had scheduled a final hearing for May 21 even though Apple’s constitutional challenge was already listed before the High Court for July 15. The court’s answer was to let the regulator continue, require Apple’s cooperation, and prevent a final CCI order before the July hearing. (hindustantimes.com) That means the legal fight now has two tracks. One track is the underlying App Store competition case before the CCI. The other is Apple’s attack on the amended penalty framework in the High Court. ### What should readers watch next? July 15 is the next fixed date that matters. (hindustantimes.com) The Delhi High Court is due to hear Apple’s challenge to the amended Competition Act on that date, while the CCI remains free in the meantime to continue seeking documents and pressing ahead with the App Store case. If the court does not extend its protection, the regulator could move toward a final order after that hearing. (money.usnews.com) (moneycontrol.com)