Apple is set to be hit with a £1 billion lawsuit that could see millions of customers in the UK receive compensation due to the company’s alleged “breach of competition” law.
Apple makes 30% commission on all apps sold in its app store, and the organisers of the lawsuit suggest that this is unfair, unlawful and needs to be addressed.
A case has now been submitted to the UK Competition Appeal Tribunal (CAT).
The organisers of the case are hoping to include all of Apple’s 20 million UK customers in the £1.5bn damages claim.
The main argument against Apple is that it blocks potential competitors and that it forces people to use its own payment system, which in turn makes Apple “unlawfully excessive levels of profit”.
The case is being led by Dr Rachael Kent of Kings College London, law firm Hausfeld and Co and Vannin Capital.
Dr Kent said: “The App Store was a brilliant gateway for a range of interesting and innovative services that millions of us find useful, myself included. But thirteen years after its launch, it has become the only gateway for millions of consumers. Apple guards access to the world of apps, and charges entry and usage fees that are completely unjustified.”
Apple said its costs for keeping the App Store up and running amounted to around £71m last year. But its profits from the App Store were around £10.6bn, which Dr Kent said is a result of “unjustified charges on users”.
As it’s been proposed, any UK consumers who own or owned an iPhone or iPad and have paid for in-app purchases, subscriptions or actual apps since October 2015 have been included in the £1.5bn damages claim.
