China Weighs Action Against Apple’s App Store Practices

China’s State Administration for Market Regulation (SAMR) is preparing to investigate Apple’s App Store policies and the fees it imposes on app developers, Bloomberg is reporting.

The move aligns with Beijing’s broader scrutiny of U.S. technology firms amid escalating trade tensions between China and the United States. The SAMR’s focus centers on Apple’s standard 30% commission on in-app purchases and its prohibition of external payment methods within the App Store.

Critics argue that these practices stifle competition and place undue financial burdens on developers. Discussions between Chinese regulators and Apple executives have been ongoing since last year, indicating a prolonged concern over these issues.

This potential investigation emerges against a backdrop of intensifying trade disputes. Recently, the U.S. imposed new tariffs on Chinese goods, prompting China to retaliate with measures targeting American companies, including Google and various agricultural equipment manufacturers. The timing suggests that the scrutiny of Apple’s practices may be part of China’s broader strategy to counter U.S. trade actions.

Apple’s App Store policies have faced global criticism. In the European Union, the company recently adjusted its App Store rules to comply with the Digital Markets Act, allowing developers to include external purchase links.

However, Apple introduced new fees, such as a “store services fee” of up to 20% on digital sales made within a year of app installation and a 5% “initial acquisition fee” on digital purchases within a year. These changes have been met with criticism from developers who argue that the fees make it financially unviable to distribute apps through both Apple and alternative app stores.

In response to the news of a potential investigation by Chinese regulators, Apple’s stock experienced a decline. Shares fell by approximately 2.6% in premarket trading.

If Apple agrees to modify its App Store policies to address the regulator’s concerns, a formal investigation might be averted. However, should Apple resist implementing changes, the SAMR may proceed with a full-scale antitrust probe, potentially leading to significant implications for Apple’s business practices in China.