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Brussels will impose the first ever fine on tech giant Apple for allegedly breaking European law on access to its music streaming services, according to five people with direct knowledge of the ongoing investigation.
The fine, which is around 500 million euros and is expected to be announced early next month, is the culmination of a European Commission antitrust investigation into whether Apple used its platform to favor its own services over those of the competitors.
The investigation is looking into whether Apple blocked apps from informing iPhone users of cheaper alternatives to access music subscriptions outside of the App Store. It was launched after music streaming app Spotify filed a formal complaint with regulators in 2019.
The Commission will rule that Apple’s actions are illegal and go against the bloc’s rules that enforce competition in the single market, people familiar with the matter told the Financial Times. It will ban Apple’s practice of blocking music services from allowing users outside its App Store to switch to cheaper alternatives.
Brussels will accuse Apple of abusing its position of power and imposing anti-competitive trading practices on rivals, the sources said, adding that the EU would claim the tech giant’s terms are “unfair trading conditions”.
This is one of the most significant financial sanctions imposed by the EU on large technology companies. A series of fines against Google, imposed over several years and amounting to around 8 billion euros, are currently being examined in court.
While Apple has never previously been fined for antitrust violations by Brussels, in 2020 the company was hit with a €1.1 billion fine in France for alleged anticompetitive behavior. The fine was reduced to 372 million euros after the appeal.
The EU’s action against Apple will reignite the war between Brussels and Big Tech at a time when companies are forced to show how they are complying with key new rules aimed at opening up competition and allowing smaller tech rivals to thrive.
Companies defined as gatekeepers, including Apple, Amazon and Google, must fully comply with these rules under the Digital Markets Act by early next month.
The law requires these tech giants to comply with stricter rules and will force them to allow rivals to share information about their services.
There are fears that the rules will not allow competition as quickly as some had hoped, although Brussels has insisted that changes take time.
Brussels formally charged Apple with an anticompetitive investigation in 2021. The commission last year narrowed the scope of the investigation and dropped charges that it pressured developers to use its in-app payment system.
Apple last month announced changes to its iOS mobile software, App Store and Safari browser in a bid to please Brussels after long resisting such measures. But Spotify claimed at the time that Apple’s compliance was a “complete and utter farce.”
Apple responded by saying that “the changes we are sharing for apps in the European Union give developers choice, with new options for distributing iOS apps and processing payments.”
In a separate antitrust case, Brussels is consulting with Apple’s rivals over the tech giant’s concessions to allay concerns that it is blocking financial groups from its Apple Pay mobile system.
The timing of the Commission’s announcement has not yet been set, but it will not change the direction of the antitrust investigation, people familiar with the situation said.
Apple, which can appeal to EU courts, declined to comment but referred to a statement a year ago in which it said it was “pleased” that the Commission had reduced the charges and said it would address concerns by promoting at the same time the competition.
He added: “The App Store has helped Spotify become the leading music streaming service across Europe and we hope the European Commission will put an end to pursuing a complaint that has no merit.”
The Commission, the EU’s executive body, declined to comment.