Apple Challenges India’s Antitrust Penalty Law That Could Cost It $38 Billion: Report

Apple has reportedly approached the Delhi High Court to challenge India's amended antitrust penalty framework, which allows the Competition Commission of India (CCI) to levy fines based on a company's global revenue rather than only its India turnover. As per the report, this change exposes Apple to a potential penalty of up to $38 billion (roughly Rs.3.4 lakh crore) if the CCI rules against it in an ongoing investigation. The Cupertino-based tech giant argues that the global-turnover formula is “unjust” and unrelated to the scale of its India operations.

Apple Moves to Court to Challenge CCI Rule

The Competition (Amendment) Act, 2023, which was passed in April 2023, added a specific provision that allowed CCI to calculate penalties based on a company's global turnover, instead of just its India-share of the revenue. As a result, if any company is found guilty, it would have to pay a hefty sum as fine. Despite being passed in 2023, this provision only came into effect in March 2024 via a government notification.

Another aspect of the provision allows the Government to penalise up to 10 percent of a company's global turnover, which is payable over three financial years. Apple is reportedly fighting this particular provision.

According to a court filing seen by Reuters, Apple has submitted a 545-page petition asking Delhi High Court to declare the law illegal citing it as “grossly disproportionate,” “arbitrary,” and “unconstitutional.” Notably, the filing reportedly claims Apple's maximum penalty exposure at 10 percent of global turnover could be as high as $38 billion (roughly Rs. 3.4 lakh crore). Apple is said to also raise concerns about retrospective use of the amendment, stating that the CCI has applied the formula in at least one earlier case involving conduct from 10 years ago.

The petition reportedly also states that penalties should be calculated only on revenue generated in India or by the business unit implicated in the investigation. The publication stated that Apple has also repeated its long-standing position that it is a smaller player in the Indian smartphone market compared to Android manufacturers.

Apple's petition to the High Court follows a CCI investigation from 2021 into the tech giant's App Store regulations. As per a confidential CCI report cited by Reuters in July 2024, the Indian regulatory body found the company's mandatory policy of only using its in-app payment system and putting restrictions on third-party billing to be an “abusive conduct.” Apple has reportedly rejected these allegations and stated that app developers in India have multiple alternative channels for distribution.

The case is reportedly listed for hearing before a division bench of the Delhi High Court on December 3. No interim relief or stay has reportedly been granted so far.