Brazil’s General Superintendence of the Administrative Council for Economic Defense (SG/CADE) has initiated (25 November) an administrative proceeding against Apple, accusing the tech giant of abusing its dominant market position.
The investigation centers on Apple’s alleged imposition of restrictive terms and conditions (T&Cs) in its iOS operating system, potentially hindering competition in app distribution, digital goods, and in-app payment processing.
Preventive Measures Imposed
As part of its investigation, SG/CADE has ordered Apple to implement preventive measures designed to ensure a fairer competitive environment. Specifically, Apple must allow iOS developers and users the freedom to choose alternative app distribution channels and payment systems for in-app purchases.
The order requires Apple to comply within 20 days, with a daily fine of R$250,000 (approximately USD 50,000) for non-compliance. These measures aim to mitigate potential irreparable harm to the market during the ongoing proceedings.
Allegations of Anticompetitive Practices
The probe focuses on whether Apple’s contractual clauses create artificial barriers to entry, effectively closing off Brazil’s markets to competitors. Such practices, SG/CADE suggests, could harm public interest and free competition by restricting innovation and limiting consumer choice.
While organizing the operation of an ecosystem like iOS is not inherently unlawful, SG/CADE highlighted concerns that Apple’s specific terms may constitute a violation of the economic order.
International Context
Brazil’s action follows similar investigations worldwide, as regulators increasingly scrutinize practices in digital ecosystems. Apple has faced mounting pressure from competition authorities in Europe, the U.S., and Asia over allegations of restricting third-party app distribution and payment systems.
Next Steps
Apple has been notified and is expected to present its defense. Once the investigation concludes, SG/CADE will issue a recommendation to either convict or dismiss the case. The final decision will rest with the CADE Court.
