In a landmark decision that could reshape the global mobile app economy, the US Ninth Circuit Court of Appeals has largely upheld the district court’s contempt ruling against Apple. This ruling reinforces District Court Judge Yvonne Gonzalez Rogers’ earlier judgment that Apple willfully violated a 2021 injunction requiring it to open up iOS App Store payments to external processing options. The appeals court’s affirmation marks a major victory for Epic Games and its CEO, Tim Sweeney, who has long advocated for a more open and competitive digital marketplace.
Apple’s “Prohibitive Practices” and Court’s Response
The three-judge appellate panel criticized Apple’s attempt to impose a 27 percent commission on developers using third-party payment systems. The court found that such fees had a “prohibitive effect” and directly violated the spirit of the earlier injunction. Furthermore, the judges condemned Apple’s constraints on how external payment links had to appear within apps, stating that these restrictions were excessively broad and hindered fair competition.
The court concluded that Apple may only ensure parity in presentation between internal and external payment options, not dominate or distort their use. The court also upheld the earlier finding that Apple acted in “bad faith” by deliberately refusing to comply with the injunction and rejecting workable alternatives. Even Apple’s defense invoking attorney-client privilege failed to convince the judges, who stated that the district court had properly evaluated all confidential materials.
Defining the Future of “Reasonable Fees”
While the district court initially prohibited Apple from charging any external payment-related fees, the appeals court suggested an adjustment. It allowed Apple to charge a “reasonable fee” reflective of actual costs incurred to maintain user security and privacy. The next phase of the case will focus on determining what constitutes a fair and transparent cost structure for these fees, a matter that could set a precedent across the tech industry.
According to Tim Sweeney, any such fees should be minimal—covering only genuine administrative and security measures. He argued that developers should pay “tens or hundreds of dollars,” not massive percentages, for necessary app review procedures. This approach, he said, would finally create “normal fees for normal businesses that sell normal things to normal customers.”
The Broader Impact: “The Apple Tax Is Dead”
Following the verdict, Sweeney declared the decision “the beginning of true, untaxed competition in payments worldwide on iOS.” His statement reflects a turning point in app commerce, one that could break Apple’s longstanding control over in-app transactions, often dubbed the “Apple Tax.” An Apple spokesperson has yet to comment, but industry observers suggest the company will face pressure to quickly implement compliant, non-punitive systems for external payments.
Developers’ Cautious Optimism Amid Fear of Retaliation
Despite the victory, many iOS developers remain cautious. Sweeney highlighted a prevailing fear among developers of potential Apple retaliation—ranging from delayed app reviews to reduced visibility in App Store search rankings. Such tactics, he claims, constitute “soft power”—subtle but significant levers Apple allegedly uses to discourage deviation from its payment ecosystem.
Some developers have already begun adopting third-party payment solutions, particularly through Epic’s new “Web Shops.” These allow direct payments outside the App Store, reducing transaction costs and fostering independent monetization strategies. Sweeney predicts that by the end of next year, external payment processing could become the new industry standard.
What Comes Next for Developers and Consumers
As Apple and the courts determine what a “reasonable fee” should look like, developers are watching closely. For consumers, the outcome could mean more competitive pricing and greater transparency when purchasing digital goods and services on iOS. For developers, it signals the potential end of a decade-long struggle against restrictive corporate control.
If Epic’s optimism proves well-founded, the ruling could spark structural change not only in the U.S. but globally—transforming how app ecosystems balance security, competition, and innovation. The decision, as Sweeney put it, opens the door to “normal competition” at last, potentially ushering in an era where developers can thrive without the burden of excessive platform fees.
