Apple told to cooperate in India

Delhi High Court has told Apple to keep participating in India’s antitrust case over App Store rules while blocking the country’s competition regulator from issuing a final order before July 15. The direction came after Apple asked the court to pause proceedings by the Competition Commission of India, or CCI, while it challenges amendments that let penalties be calculated on global turnover rather than only India revenue. The court instead gave both sides part of what they wanted: the investigation can continue, but the regulator cannot finish the case before the court hears Apple’s petition. Apple said in court that the amended penalty framework could expose it to a maximum penalty of about $38 billion. ### Why did the Delhi High Court step in now? May 15 was the date the court intervened after Apple said the CCI had fixed a final hearing for May 21 even though Apple’s separate challenge to the penalty rules was already listed for July 15. A bench led by Chief Justice D.K. Upadhyaya and Justice Tejas Karia told the regulator to proceed with the case but not issue a final decision until the court takes up Apple’s petition. (thehindu.com) The judges also directed Apple to “fully cooperate” with the regulator’s proceedings. Hindustan Times reported the bench told the CCI that passing a final order before the July hearing could create “complications,” while The Hindu quoted the court as saying, “Lay your hands off till July 15. Proceed with the matter. They will cooperate but you will not pass a final order.” (thehindu.com) ### What is India’s antitrust case against Apple about? The CCI’s case dates to 2021, when non-profit Together We Fight Society accused Apple of abusing its position in the iOS app ecosystem. Match Group later joined, and Indian startups represented by the Alliance of Digital India Foundation also became part of the proceedings, according to Medianama and Hindustan Times. (thehindu.com) The central allegation is that Apple requires developers to use its own in-app payment system and charges commissions of up to 30%. A 2024 CCI investigation report seen by Reuters said Apple’s App Store was an “unavoidable trading partner” for iOS app developers and that developers had no choice but to accept Apple’s terms, including use of its proprietary billing system. (medianama.com) ### Why is the possible penalty so large? Apple’s court filing challenges amendments to India’s Competition Act that allow the CCI to calculate penalties using a company’s global turnover. Before the change, Apple argued, penalties were tied more narrowly to revenue from the affected product or service in the relevant market. (timesofindia.indiatimes.com) The Hindu reported Apple told the court that 10% of its average global turnover across fiscal years 2022 to 2024 could amount to roughly $38 billion. That figure is Apple’s stated maximum exposure under the amended rules, not a penalty that has been imposed. ### What has Apple argued in its defense? Apple has argued that its court challenge is aimed at the legality of the penalty provisions, not at stopping the antitrust case altogether. (thehindu.com) Medianama reported the company said the provisions unlawfully expand the CCI’s powers and could allow retrospective penalties based on global turnover. In the underlying competition case, Apple has previously said its App Store policies support user safety and security and has argued that its overall smartphone share in India is small. (thehindu.com) Reuters’ 2024 reporting on the CCI investigation said Apple disputed the regulator’s findings and denied wrongdoing. (medianama.com) ### What happens next in the case? May 21 is the next scheduled CCI hearing date cited in court filings and press reports. The regulator can continue hearing the matter and seek Apple’s cooperation, but it cannot issue a final order before July 15 under the High Court’s direction. July 15 is the date the Delhi High Court is set to hear Apple’s challenge to the amended penalty provisions. (timesofindia.indiatimes.com) Any final CCI order in the App Store case must wait until at least then, according to the court’s May 15 direction. (thehindu.com) (hindustantimes.com)