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News 10 May 2021 - 2 min read

ACCC eyes role in Epic versus Apple court battle

By Brendan Coyne - Editor

The Australian Consumer & Competition Commission has sought leave to appear in Epic Games' bid to have legal dispute with Apple heard in Australia as the tech giant tries to force the case to be held in the US.

What you need to know:

  • ACCC has sought leave to appear in Epic Games' bid to have legal dispute with Apple heard in Australia.
  • Regulator has keen interest in case and has signalled intent to intervene in app market over barriers to competition.
  • Apple wants case held in California, per terms of its contractual agreement with Epic.

The ACCC has sought leave to appear at the hearing of Epic Games’ appeal to the Full Federal Court against an earlier Court decision to stay Epic’s proceedings against Apple.

If granted, the regulator said its presence would be as a friend of the court. As such, it would not become a party to the proceedings, but would make submissions on limited issues.

Epic launched proceedings in Australia late last year after Apple removed its hugely popular Fortnite game from the App Store. Fortnite had attempted to offer players a 20 per cent off platform discount on in-game purchases. This goes against Apple’s terms – and Google took the same action within hours.

Fortnite has launched multiple actions against Apple and Google around the world as a result. In Australia it argues that Apple has breached the Competition and Consumer Act by not allowing alternative app stores on its iOS operating system for Apple mobile devices, and by charging app developers a 30 per cent commission on in-app purchases of digital content.

But Apple has argued that its commercial agreements with Epic state that all disputes must be heard within Californian courts, and last month was granted a stay to that effect.  Epic is appealing – and that appeal hearing is where the ACCC intends to appear.

The ACCC has a keen interest in the case. Two weeks ago, it published interim findings of its probe into Australia’s app marketplace.

The report suggests the regulator may intervene around Apple and Google tying people to in-app payments through their platforms and charging full commission – a key issue in the dispute between Apple and Epic.

It also signalled that the regulator is considering interventions around self-preferencing, i.e. Apple and Google pre-installing their own apps on handsets.

The outcome of Epic cases may have a material impact on both Google and Apple’s app revenues, estimated to be USD29.3 billion and USD54.2 billion respectively in 2019.

 

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