Apple Slapped With Massive Fine by Russian Monopoly Watchdog

Russia’s Federal Antimonopoly Service (FAS) announced on Tuesday that it has imposed a more than $17 million fine on US tech giant Apple for violating Russia’s anti-monopoly legislation and abuse of its dominant market position.

After establishing last July that the US tech company has been forcing developers to use only the payment system provided by the company itself, the watchdog ruled that Apple has breached local laws with the rules of its AppStore, which resulted in this hefty fine.

The FAS explained in a statement that iOS app developers were prohibited by App Store rules to inform in-app customers they have the possibility to pay for purchases outside of the App Store as well as that they can also use alternative payment methods.

In line with App Store rules, developers were forced to prevent registration forms from leading to external sites by removing links to their own Internet sites and by changing the functionality of the application.

The fact that the imposed fine has been calculated based on Apple’s annual revenue in Russia resulted in the unusually massive size of the fine stems although FAS has threatened before to fine foreign tech giants between 0.01 and 0.15% of their revenue if they are found in breach of the anti-monopoly rules.

US tech giant Google also faced a similar ruling by the FAS last July but, unlike Apple, the company adhered to the watchdog’s warnings and tweaked last September payment rules of its Google Play to be in line with Russia’s laws and legislation.

Given that Apple announced its withdrawal from Russia early in the ongoing conflict between Russia and Ukraine – which broke out last September – it was not immediately clear how exactly the fine will be enforced.

Meanwhile, Apple’s Russian subsidiary appears to be active, with no reports of its potential liquidation or bankruptcy readily available despite widely circulated rumors about the company will be closing its office in Moscow and relocating its staff to other countries.

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