Apple has officially submitted its proposed commission rates for purchases made outside the App Store’s in-app purchase system, as part of the ongoing legal battle with Epic Games. The proposal, filed with the U.S. District Court, outlines a tiered fee structure that would apply to so-called “linked-out” purchases — transactions that occur when developers direct users to alternative payment methods outside Apple’s ecosystem.

Background of the Epic Games v. Apple Case

The dispute between Apple and Epic Games began in August 2020, when Epic intentionally violated App Store guidelines by implementing a direct payment system in Fortnite. Apple responded by removing the game from the App Store, prompting Epic to file an antitrust lawsuit. The case centered on whether Apple’s App Store policies, including mandatory use of its in-app purchase system and commission fees, constitute illegal monopolistic practices.

In September 2021, Judge Yvonne Gonzalez Rogers issued a sweeping ruling that largely favored Apple on antitrust claims but ordered the company to allow developers to include external payment links and buttons in their apps. That injunction, however, was partially stayed by the Ninth Circuit Court of Appeals, which agreed with Apple that the outright ban on commissions for linked-out purchases went too far. The appeals court determined that Apple could charge a commission on such purchases, provided the fee was not effectively prohibitive.

Since then, the case has moved through a complex series of proceedings. Apple has repeatedly attempted to pause the district court’s rate-setting process while the Supreme Court considers whether to review the contempt ruling related to Apple’s 27% commission on off-App Store purchases. The Supreme Court denied Apple’s request in August 2026, clearing the way for the lower court to continue determining what fee structure is appropriate.

Apple’s Proposed Fee Structure

In its latest filing, Apple proposed the following commission rates for off-App Store purchases:

• 15% for standard apps subject to the usual 30% IAP commission;
• 10% for the Video Partner Program, News Partner Program, Mini Apps Partner Program, and subscription renewals;
• 5% for apps enrolled in the Small Business Program.

The proposal marks a significant discount from the 27% commission Apple had been charging for external purchases under its previous interpretation of the court’s injunction. Apple’s new rates are designed to align with expert testimony and to provide developers with meaningful financial relief while still allowing Apple to recover costs associated with its intellectual property, tools, and services.

Apple’s Justification and Expert Analysis

Apple’s filing includes fact and expert evidence supporting the proposed rates. According to the company, “Based on expert analysis, it appears that large numbers of U.S. developers collectively accounting for the lion’s share of App Store revenue will be able to link out profitably at the proffered rates, resulting in substantial competitive pressure on IAP, a goal this Court has repeatedly emphasized.”

Apple further argued that the proposed rates are not only fair but also necessary to preserve a competitive and sustainable ecosystem. The company emphasized that its intellectual property-protected tools, technologies, and services provide substantial value to developers, and that the courts have previously recognized this as legitimate and procompetitive.

The company also stressed that it continues to believe the rate-determination proceedings should be paused while its case is before the Supreme Court. Apple stated that it submitted the proposal only to comply with Judge Gonzalez Rogers’s instructions and reiterated its position that the Ninth Circuit’s reversal of the outright ban on commissions should guide the outcome.

Comparative Commissions Across App Stores

Apple’s filing drew comparisons with commissions charged by other app stores. The company noted that Google Play, Samsung Galaxy Store, and Amazon’s Android App Marketplace all have comparable fees for external purchases. Specifically, Apple highlighted that Google Play charges linked-out rates of 20% for standard apps, 15% for program participants, and 10% for subscriptions. Apple pointed out that Epic agreed to those rates in its own dealings with Google, suggesting that they are widely accepted within the industry.

This comparison is central to Apple’s argument that its proposed rates are not anticompetitive but rather reflect the value of app store services across the market. By benchmarking against competitors, Apple hopes to demonstrate that its fees are within a reasonable range and that developers have viable alternatives.

The ‘Necessary Costs’ Standard

One of the key legal questions in this case is the definition of “necessary costs” as articulated by the Ninth Circuit. The appeals court ruled that Apple could charge a commission for linked-out purchases, but only if the fee is necessary to cover the costs of the services Apple provides. In response to Apple’s proposal, Epic argued that Apple effectively admitted that its necessary costs amount to zero for web-based transactions, since the company’s own analysis showed that a 0% commission would suffice under that definition.

Epic’s interpretation stems from Apple’s acknowledgment that the Ninth Circuit’s framework would allow for a 0% commission if the costs directly attributable to the linked-out transaction are negligible. Epic contends that Apple’s proposed 15% and 5% rates are not tied to actual costs and therefore violate the appellate court’s mandate. This argument is expected to be a central point of contention in the upcoming proceedings.

Epic’s Reaction and Next Steps

Epic Games quickly responded to Apple’s filing. In a statement posted on X, Epic’s newsroom asserted that Apple admitted under the Ninth Circuit’s definition of “necessary costs” it would charge 0% for purchases made via linkouts to the web. Epic noted that Apple proposed linkout fees of 15% for standard apps and 5% for Small Business Program apps, and expressed its belief that those rates still violate the court’s rulings.

Epic’s statement suggests that the two companies remain far apart on what constitutes a lawful commission. The upcoming proceedings will allow Epic to formally respond to Apple’s proposal, and the court will ultimately decide whether Apple’s rates are permissible or whether they impose an unnecessary burden on developers.

Apple is expected to file its brief with the Supreme Court by September 14, which means the legal battle is far from over. Even as the district court moves forward with the rate-setting process, the Supreme Court’s eventual decision could reshape the entire framework for app store commissions in the United States.

The case has been closely watched by developers, regulators, and antitrust experts around the world. A ruling that Apple’s proposed fees are too high could open the door to greater price competition and more flexible payment options for app developers. Conversely, a decision that validates Apple’s approach could solidify the App Store’s commission structure for years to come.

Beyond the immediate legal dispute, the outcome of this case could influence ongoing regulatory efforts in the United States and abroad. Lawmakers in several jurisdictions have proposed or enacted legislation aimed at loosening Apple’s and Google’s control over app distribution and payments. The litigation between Apple and Epic is widely seen as a proxy for these larger policy battles, with both sides using the courts to test the boundaries of antitrust law in the digital economy.

For now, all eyes are on the district court as it evaluates Apple’s proposal. The outcome will not only affect Epic Games but also millions of app developers who rely on Apple’s platform to reach customers. The next hearing and subsequent filings will likely provide additional clarity on how the court views the balance between Apple’s business interests and the competitive concerns raised by developers.

Source:9to5Mac News