Apple is contesting the new antitrust penalty framework in the Delhi High Court, cautioning that regulations permitting fines based on global turnover could subject the company to an extraordinary penalty of $38 billion—potentially one of the largest corporate fines ever recorded. The iPhone manufacturer submitted a constitutional challenge on November 25 against the amendments to India’s 2024 Competition Act, which allow the Competition Commission of India (CCI) to determine penalties based on worldwide revenue rather than restricting fines to earnings specific to India. In its 545-page petition, Apple describes the provision as “manifestly arbitrary, unconstitutional, grossly disproportionate, and unjust.”
The case originates from an antitrust dispute in 2022 initiated by Match Group alongside Indian startups, during which CCI investigators concluded that Apple exhibited “abusive conduct” by mandating developers to utilize its in-app purchase system and imposing commissions as high as 30%. Apple asserts that it possesses only a minor market share in India relative to Android, despite the fact that the company’s user base has increased fourfold over the past five years.
The CCI’s inquiry uncovered that Apple’s App Store functions as the exclusive channel for app distribution to iOS users in India, establishing what regulators classified as a monopoly. Investigators found that Apple’s compulsory in-app purchase system limits developers’ options, especially in light of the high commission rates. Furthermore, the commission discovered that Apple forbids app developers from notifying users about alternative purchasing methods via in-app alerts—restrictions that could lead to elevated prices for Indian consumers who might otherwise discover more affordable options on developers’ websites.
Moreover, the CCI expressed apprehensions regarding Apple’s anti-steering provisions, which inhibit apps from featuring buttons or external links that direct customers to non-Apple payment systems. The regulator contended that these practices not only obstruct market access for competing payment processors but also stifle technical innovation by diminishing competitive pressure on Apple to enhance its own services. Apple disputes both the retrospective enforcement of the amendment and the CCI’s authority to evaluate global turnover, arguing that such an interpretation surpasses the limits of the Competition Act. The company illustrated its position by likening the scenario to penalizing a toy retailer’s entire business for infractions related to a single product line.
Court session scheduled for December 3
The Delhi High Court, presided over by Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela, is scheduled to hear the case on December 3. Nevertheless, legal experts indicate that Apple is likely to encounter significant challenges, with competition law partner Gautam Shahi highlighting that the revised law explicitly allows for the consideration of global turnover, complicating efforts to contest established legislative policy.
Apple referenced the CCI’s application of the new regulations on November 10 in an unrelated matter, where penalties were retroactively enforced for a violation that occurred a decade ago, which has led the company to initiate its constitutional challenge at this time. In the meantime, Match Group has contended that imposing fines based on global turnover would act as a substantial deterrent against future violations. The CCI has yet to render a final decision or impose any penalties in the ongoing proceedings against Apple.
