Apple wins Chinese lawsuit claiming App Store fees are too high

Apple won a lawsuit accusing it of abusing its dominant position in the app market, and a Chinese court rejected the claim that the fees Apple charged in the App Store were too high.

In 2021, Jin Xin sued Apple China, insisting that Apple stop charging the 30% commission from the App Store. Xin also demanded that Chinese consumers be allowed to use payment systems other than Apple, as well as an apology and compensation of about $15,500.

Three years later, the Shanghai Intellectual Property Court sided with Apple, according to a yet-to-be-published ruling obtained by South China Morning Mail.

In Wednesday’s decision, the court said it compared Apple’s commissions to other app marketplaces. It did not find that Apple’s fees are “significantly higher” than those running on Android.

It also found there was no evidence to suggest the fees led to higher prices for consumers.

In response via WeChat, Xin’s legal representative wrote about his intention to appeal to China’s Supreme People’s Court. Xin and lawyers “strongly believe” that Apple’s fees constitute an abuse of its dominant market position and violate Chinese consumers’ right to a fair transaction.

Apple’s fees have increased operating costs for Chinese companies, said Wang Qiongfei, founder of Kinding law firm. “This has destroyed the competitiveness of Chia’s internet industry.”

War on fees

While the victory in China is helpful for Apple, it is not the only lawsuit against the App Store it is dealing with.

In the UK, a July 2023 lawsuit by more than 1,500 developers accused Apple’s 30% fee as being too excessive and abusing its monopoly position. However, in April, the UK’s Competition Appeal Tribunal rejected Apple’s request to dismiss the case.

It is not known when the case will go to court.

Apple has already argued with Epic Games on this matter during the main lawsuit, from which Apple was mostly victorious. However, while the Supreme Court has effectively ended further appeals, the two drivers are still fighting in court over compliance with anti-steering laws.

Meanwhile, in Europe, Apple had to deal with changes in the law, with the Digital Markets Act allowing alternative payment methods and alternative app store sites. Even though Apple is seeing fewer transactions in the App Store, it still intends to monetize iOS app developers through a core technology fee.