Apple Inc (NASDAQ:AAPL) is facing an investigation by the EU’s antitrust regulators, who said on Tuesday that the terms and conditions in the company’s App Store and Apple Pay functions may be violating the trade bloc’s rules on competition.
The European Commission said that it will launch two probes into the tech giant. One will focus on the company’s terms and conditions on Apple Pay should be used on merchant apps and websites as well as its refusal to allow rivals to access to the payments system.
The second, meanwhile, will investigate the mandatory use of the company’s proprietary in-app purchase system and restrictions on a developers ability to inform iPhone and iPad users of cheaper purchasing possibilities outside of the apps.
The EU investigation follows a complaint from Swedish music streaming platform Spotify Technology SA (NYSE:SPOT) as well as e-reader firm Kobo regarding Apple’s 30% commission on every subscription through its app store in the first year as well as a 15% cut.
“It appears that Apple obtained a “gatekeeper” role when it comes to the distribution of apps and content to users of Apple's popular devices. We need to ensure that Apple's rules do not distort competition in markets where Apple is competing with other app developers”, the Commission’s executive vice-president Margrethe Vestager said in a statement.
On the Apple Pay investigation, she added: “It is important that Apple's measures do not deny consumers the benefits of new payment technologies, including better choice, quality, innovation and competitive prices. I have therefore decided to take a close look at Apple's practices regarding Apple Pay and their impact on competition".
Apple’s shares were 1.9% higher at US$349 in pre-market trading in New York on Tuesday.