India has issued a final warning to Apple, indicating that it will proceed with an antitrust case against the tech giant. This development follows concerns that Apple has been delaying responses to Indian officials for over a year, undermining the investigation.
The core of the dispute lies in the Competition Commission of India's (CCI) findings that Apple has allegedly limited third-party payment processors for in-app purchases on its iOS platform, potentially impacting millions of users in India. Fees for these in-app purchases can reach as high as 30%, raising concerns about anti-competitive practices.
Apple is challenging India's antitrust penalty law, particularly a 2024 amendment that allows the CCI to base penalties on a company's global turnover rather than just its Indian revenue. Apple argues that any penalty should be based solely on the revenue of the specific business unit involved. The company warns that applying global turnover is arbitrary, disproportionate, and unconstitutional, potentially exposing it to fines of up to $38 billion. Apple's plea is scheduled to be heard on January 27 at the Delhi High Court.
The CCI, however, defends the law, arguing that it is essential to deter antitrust violations by multinational corporations. The regulatory body argues that limiting fines to India-specific revenue, especially for large digital firms, weakens enforcement and allows companies with substantial financial resources to absorb penalties without changing their behavior. The CCI maintains that the revised framework aligns India's enforcement regime with international standards, including those followed in the European Union. It asserts that penalties based on worldwide revenue ensure that sanctions retain "real deterrent value" in increasingly complex and cross-border digital markets.
Furthermore, the CCI has accused Apple of attempting to mislead the court, stating that it had only sought India-specific financial information from the company despite having the authority to consider global revenue. Apple, however, maintains that the information requests align with the amended law and could significantly increase its potential liability. Apple has also raised concerns about retrospective enforcement of the law, noting instances where the rules were applied to violations from a decade earlier. The CCI denies applying the law retrospectively, stating that it has always had the power to levy fines of up to 10% of a company's turnover and that the amendment merely clarified how turnover should be interpreted.
The outcome of this case could have wider implications for other multinational firms facing antitrust scrutiny in India, including companies like Amazon. The Delhi High Court is scheduled to further hear the matter on January 27.
