Apple attacks India's antitrust reform and Apfelpatient revenue formula

Apple is facing a legal battle in India that could have far-reaching consequences. A new antitrust penalty rule allows the Indian competition authority to calculate fines not based on local revenue, but on the company's global revenue. For a corporation like Apple, this represents a significantly greater risk. The situation is tense because the maximum potential fine could reach around $38 billion.

The conflict has a history dating back to 2022. Complaints from the Match Group and various Indian startups led to an investigation into the iOS app market. The accusation was that Apple had abused its dominant market position. While the investigation was underway, antitrust penalties in India were revised in 2024. This change now forms the core of the dispute, as the new calculation method could have enormous financial consequences for Apple. The company has therefore filed a constitutional challenge to prevent the application of this rule.

Apple is suing over the new revenue formula

The 2024 antitrust penalties allow the Competition Commission of India to calculate fines based on a company's worldwide revenue. Apple considers this an unfair and disproportionate approach. In a 545-page constitutional complaint, the company describes the regulation as arbitrary, unconstitutional, grossly disproportionate, and unjust.

The basis for the potential penalty stems from the possibility of imposing up to 10 percent of average worldwide revenue from all services over three fiscal years. According to Apple's own calculations, this would mean a maximum charge of approximately $38 billion. This figure is based on global services revenue and is independent of the actual revenue generated in India (via Reuters).

Origin of the procedure

The ongoing investigation dates back to 2022, when Match Group and several Indian startups complained about Apple's App Store policies. They accused the company of exploiting its position in the iOS app market. The CCI published a report last year supporting these allegations. However, there has been no final decision or specific penalties yet.

Apple is therefore trying to preempt the application of the new global revenue formula. Should the CCI conclude that Apple has abused its market power, it would apply the 2024 regulations. This is precisely what Apple wants to prevent through its constitutional challenge.

Different perspectives

While Apple views the new penalty logic as disproportionate, the Match Group considers the approach sensible. In their view, taking global revenue into account ensures that penalties are severe enough to deter repeat offenses.

Competition expert Gautam Shahi, however, assesses Apple's chances of success as slim. The law is clearly worded, he says, making it difficult to convince a court to intervene in a clearly defined regulation. The hearing will take place next week. Only then will it become clear whether Apple's attempt will succeed or whether the CCI will be allowed to apply the new formula.

India's course and its consequences for Apple

The dispute between Apple and the Indian competition authority demonstrates how significantly national legal changes can impact global companies. India is pushing for stricter rules to protect competition in the digital market. Apple sees this as a disproportionate threat to its business. The court's decision could determine not only a potential multi-billion dollar fine, but also how antitrust proceedings against international tech giants will be conducted in the future. (Image: Shutterstock / Manoej Paateel)