Apple moves Delhi High Court against use of global turnover for CCI penalties

New Delhi: Apple has approached the Delhi High Court to challenge provisions of India’s competition law that permit the Competition Commission of India (CCI) to impose penalties based on a company’s “global turnover” under Section 27(b) of the Competition Act, according to Bar and Bench.

The matter has been listed before a Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela for hearing on Wednesday.

The Union of India and the CCI have been named as respondents in the petition.

The US-based technology company has contested the 2023 amendment to Section 27(b) of the Competition Act, 2002, along with the Competition Commission of India (Determination of Monetary Penalty) Guidelines, 2024, insofar as they introduce the concept of “global turnover” for the purpose of calculating penalties.

Section 27(b) empowers the CCI to impose penalties of up to 10% of the average turnover or income of the preceding three financial years on an enterprise, or group of enterprises, for abuse of dominant position or participation in anti-competitive agreements. The provision allows penalties to be levied on all parties to such agreements or those found to have abused their dominant position.

The 2023 amendment to Explanation 2 of Section 27(b) broadened the definition of “turnover” to include “global turnover”, thereby widening the scope for penalty computation.