Highlights:
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Epic Games wins partial court victory against Apple and Google in Australia over app store restrictions.
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Federal Court rules both companies breached section 46 of the Competition and Consumer Act by reducing competition.
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Class actions from app developers also succeed; compensation to be decided later.
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Apple found to have blocked side-loading and alternative payment methods on iOS.
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Google found to have breached laws through Play Store billing rules and “Project Hug” program.
Epic Games has secured a significant ruling in the Federal Court of Australia against Apple and Google over app store restrictions and in-app payment systems. The decision marks a step forward in the company’s long-running battle to open up mobile platforms to greater competition.
The court found that both Apple and Google engaged in conduct that reduced competition in breach of the Competition and Consumer Act. Two related class actions brought by app developers were also successful. However, any operational changes to the companies’ app store systems in Australia will take time due to further proceedings.
Background to the Epic Games Case
The dispute began in 2020 when Apple and Google removed Epic Games’ popular title Fortnite from their app stores. The removal followed Epic Games introducing its own in-app payment system, which bypassed the platforms’ standard transaction fees.
Apple’s policies require that all apps for iOS devices be installed through the App Store and that all in-app purchases be processed via its payment system. Google’s Android platform allows “side-loading” and alternative app stores, but still applies restrictions to apps distributed through Google Play.
Apple and Google charge developers transaction fees ranging from 15% to 30%, while Epic Games operates its own store with a 12% fee. The company has argued that these higher fees, combined with restrictions on alternative payment systems, stifle competition and harm both developers and consumers.
Federal Court Findings on Epic Games’ Claims
Justice Jonathan Beach merged the Australian proceedings against Apple and Google, along with two class action suits from app developers, into a single hearing. The court’s decision included key findings:
- Apple breached section 46 of the Competition and Consumer Act by preventing the side-loading of apps on iOS devices and by restricting developers from using alternative payment methods.
- Google breached section 46 by enforcing Play Store billing rules and through “Project Hug,” a program aimed at keeping developers on the Google Play platform.
While Epic Games succeeded in these specific claims, other elements of its case were dismissed.
The class action claims also prevailed, with the court concluding that both Apple and Google had overcharged developers by leveraging their market dominance. The level of compensation is yet to be determined and will be decided at a future hearing.
Epic Games’ Response to the Ruling
Following the decision, Epic Games described the outcome as “a win for developers and consumers in Australia.” The company announced plans to reintroduce its app store and Fortnite to iOS in Australia but indicated that it would need time to examine the more than 2,000 pages of court findings.
Google, Apple, and Legal Representatives React
A Google spokesperson welcomed the court’s acknowledgment of the differences between Android’s “open” system and Apple’s “closed” ecosystem. However, the company disagreed with aspects of the judgment related to billing policies and past partnerships. Google said it would review the decision before determining its next steps.
Maurice Blackburn Lawyers, representing the app developers in the class actions, called the decision “a turning point” and stated that “even the most powerful corporations must play by the rules and respect the rights of consumers and developers alike.”
Apple has not issued a public statement in response to the ruling.
Next Steps for Epic Games and the Industry
Justice Beach’s written judgments for the Apple and Google cases each exceed 900 pages, with the class action judgment surpassing 100 pages. Redacted versions will be published to safeguard commercially sensitive information.
Any changes to the way Apple and Google operate their app stores in Australia will require further hearings to determine the specific remedies. As a result, industry analysts expect it may take months before any practical effects are seen.
Currently, Fortnite remains unavailable on the Australian Apple App Store. The game has returned to iOS in the United States and can be downloaded through the Epic Games Store in Europe.
Broader Implications of the Epic Games Decision
The outcome of the Australian case adds to Epic Games’ global legal campaign against what it views as anti-competitive practices in mobile app distribution. Similar cases have been pursued in the United States, the European Union, and other jurisdictions.
While the ruling does not immediately change app store policies, it strengthens the legal arguments of those advocating for alternative payment options and lower developer fees. The success of the class actions could also set a precedent for future claims by developers who allege overcharging by dominant digital platforms.
For Epic Games, the decision reinforces its strategy of challenging restrictive app store practices on multiple legal fronts. Whether the company can translate this partial win into meaningful changes for Australian developers and consumers will depend on the outcome of upcoming hearings.
