Australia to Fine Apple and Google for Abusing Market Power

A federal court in Australia decided that Apple and Google misused their market power by limiting the use of alternative app distribution and payment methods in their smartphone app stores. The companies have 28 days to appeal the decision.

Epic, the creator of Fortnite, which filed cases back in 2020 and 2021, said the court found Apple and Google abuse their control over app distribution and in-app payments to limit competition. The company added that this is a win for developers and consumers in Australia.

In a summary of the ruling, law firm Gilbert and Tobin explained the court found the companies’ practices, dating back to 2017, breached the country’s competition and consumer act, adding Apple and Google had caused developers to pay materially higher commissions. The law company noted the decision is the first contested case of the country’s new misuse of market power law, introduced in 2017, and grapples with the issues of walled gardens.

In the case of the app distribution and in-app payment markets, the court ruled that both companies engaged in conduct that had the purpose, effect, or likely effect of substantially lessening competition. The court, however, did not accept Epic’s other anti-competitive claims covering exclusive dealings, anti-competitive agreements, or unconscionable conduct allegations by Apple and Google in the OS licensing market to OEMs.