Digital Government

Apple loses bid to prevent its case from being heard in Australia

Eliza Sayon Dec 3, 2021

2 min read

Australia’s High Court has refused the tech giant’s application for special leave that will prevent a landmark monopoly case against Apple from being heard in Australia.

This Thursday, the High Court in Canberra refused the company’s efforts to appeal against a Federal Court judgment that prevented it from staying Epic Games’ litigation in Australian courts.

The case, which alleges that Apple misused its market power over a popular online game, is being stopped by the company as it points out that its contract with Epic Games dictates that disputes must first be filed in California.

While the Federal Court in Sydney initially granted Apple a temporary stay and required the game developer to file the case in the United States, it overturned the stay ruling in July.

Epic Games, which is the creator of Fortnite, argued that the Federal Court’s decision could have a “chilling effect” on competition in Australia. The gaming company argues that the decision was signalling companies that they could avoid local laws with court selection contract clauses.

The Federal Court agreed to this, saying there were strong reasons not to grant the stay because enforcing the exclusive jurisdiction clause “would offend” Australian public policy.

However, the competition regulator intervened in the appeal by arguing that cases dealing with conduct that impacts Australian markets and Australian consumers should be heard in Australia by Australian courts.

The Australian Competition and Consumer Commission chair Rod Sims said the case “raises important issues for competition in the digital marketplace”.

In the primary case, Epic Games alleged that Apple and its Australian subsidiary breached Australian laws forbidding exclusive dealing, the misuse of market power and unconscionable conduct.

The gaming company also filed a separate case against Google in March. In that case, Epic Games claimed that Google was inflating the price of apps and in-app content for millions of Android users in Australia.

After Epic Games allowed users to directly pay for in-app content, Fortnite was banned from the App Store and Google Play Store. This change bypassed the in-app payment systems that deliver Apple and Google significant commissions.

Unlike Google, Apple prevents iOS users from downloading apps from anywhere but its app store.

Apple says its priorities always were to provide customers with a safe and trusted place to download software and to apply the rules equally to all developers.

In refusing Apple’s application, the High Court awarded costs against it.

With AAP

Eliza Sayon

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Eliza is a content producer and editor at Public Spectrum. She is an experienced writer on topics related to the government and to the public, as well as stories that uplift and improve the community.