Apple faces $1 billion UK lawsuit by apps developers over app store fees

By Foo Yun Chee

BRUSSELS (Reuters) – Apple (NASDAQ:) on Tuesday found itself the target of a 785-million-pound ($1 billion) class action lawsuit brought by more than 1,500 apps developers in the UK over its App Store fees.

Apple’s services business, which includes the App Store, has seen revenues grow at a rapid pace in the last few years and now hovers around $20 billion per quarter.

However, the commissions of 15% to 30% that the company charges some app makers for use of an in-app payment system has been criticised by apps developers and targeted by antitrust regulators in several countries.

Apple has previously said that 85% of developers on the App Store do not pay any commission and that it helps European developers to access markets and customers in 175 countries around the world through the App Store.

The UK lawsuit at the Competition Appeal Tribunal is being brought by Sean Ennis (NYSE:), a professor at the Centre for Competition Policy at the University of East Anglia and a former economist at the OECD, on behalf of 1,566 app developers.

He is being advised by law firm Geradin Partners.

“Apple’s charges to app developers are excessive, and only possible due to its monopoly on the distribution of apps onto iPhones and iPads,” Ennis said in a statement.

“The charges are unfair in their own right, and constitute abusive pricing. They harm app developers and also app buyers.”

($1 = 0.7802 pounds)