The Competition Commission of India (CCI) has been investigating Apple Inc since 2021 for potentially abusing its dominant position in the app market by compelling developers to use its proprietary in-app purchase system. According to a confidential report, Apple has been found to engage in abusive conduct and practices, exploiting its dominant position in the market for app stores on its iOS operating system. The CCI's investigations unit stated in its report that Apple wields "significant influence" over how digital products and services reach consumers, especially through its iOS platform and App Store.
The report highlighted that the Apple App Store is a necessary trading partner for app developers, and app developers have no choice but to adhere to Apple's unfair terms. The CCI report will be reviewed by the watchdog's senior officials, and Apple, along with other parties, will be allowed to respond before a final decision is reached, which could include monetary fines as well as directives to change business practices.
In a similar case, the CCI imposed a $113 million fine on Google in October 2022 and said it must allow the use of third-party billing and stop forcing developers to use its in-app payment system. Google has challenged the decision.
The CCI report comes as Apple faces increased antitrust scrutiny in other regions. In June, European Union antitrust regulators indicated that Apple breached the bloc's tech rules, which could result in a hefty fine for the iPhone maker. Furthermore, Apple also faces an investigation into new fees imposed on app developers. Apple outlined plans in response to a new EU law called the Digital Markets Act to allow software developers to distribute their apps to users in the European Union outside of Apple's own App Store.
The Indian case against Apple was filed by a non-profit group called "Together We Fight Society," which argued that Apple's in-app fee of up to 30% hurts competition by raising costs for app developers and customers. The case was later supported by a group of Indian startups, Alliance of Digital India Foundation, and Tinder-owner Match. The CCI investigation team noted in its report that no third-party payment processor was being permitted by Apple to provide the services for in-app purchases. It added that in most cases, the apps are not being allowed to include any external links that direct customers to other purchasing mechanisms, violating Indian competition laws.
Apple has denied wrongdoing, stating that it is a small player in India where phones that use Google's Android system are dominant. Apple argued that its market share in India is an "insignificant" 0-5%, while Google commands 90-100%. The company also argued that the in-app payment system allowed it to maintain and develop the safety of its App Store. However, the CCI reported, "App stores are OS (operating system) specific and Apple's App store is the sole App store available for reaching iOS users." The CCI concluded that "the payment policy of Apple adversely affects the app developers, users, and other payment processors."
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