A Brazilian federal court has given an important order to Apple, directing the company to allow third-party app stores and sideloading on its iOS devices. The court has given Apple 90 days for this, otherwise, it has been ordered to pay a fine of $40,000 (about Rs 34.83 lakh) per day. The court believes that Apple exerts excessive control to limit competition on the iOS platform, causing harm to app developers. After this decision, Apple will have to change its model in the field of app stores, which has already been implemented in other countries.
Brazil’s antitrust regulator CADE had already accused Apple of suppressing competition in the iOS app market. CADE had ordered Apple to remove restrictions related to its in-app purchase system and allow alternative payment systems. The same order has now been implemented by the Brazilian Federal Court as well.
The case began with a complaint filed by an e-commerce company called Mercado Livre in 2022. The company had alleged that Apple was forcing its developers to use its payment system, giving the company an unfair advantage. After this, CADE took action against Apple and ordered a ban on it.
The Federal Court of Brazil has ordered Apple to allow third-party app stores to operate on the iOS platform. This means that iPhone and iPad users will no longer be limited to the App Store, but they will also be able to download apps from other app stores. Apart from this, Apple will also have to allow sideloading, that is, users will be able to download and install apps directly from the website or other sources, as can be done on Android devices. Along with this, Apple has also been ordered to accept alternative payment gateways in addition to its in-app payment system, so that developers can get a chance to avoid Apple’s commission.
Apple has objected to this decision and said that the changes proposed by CADE could put users’ privacy and security at risk. The company plans to appeal against this order. However, this is not a new case for Apple. The company has already made changes in the iOS 17.4 update under the Digital Markets Act (DMA) in the European Union (EU), allowing European users to use third-party app stores. Now Brazil can become the second largest market after the EU, where Apple will be forced to open its ecosystem. After this decision, the possibility of similar changes may increase in other countries as well.
This decision of Brazil has made it clear that companies have to bring transparency in their device and app store policies and promote competition. This change may be a challenge for Apple, but it may be a signal to other countries that they can also take steps to improve their markets.
