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In a landmark decision, the Court of Appeal has empowered the Competition and Markets Authority (CMA) to initiate a critical investigation into Apple and Google's mobile browser and cloud gaming services. This ruling reverses a previous judgment that barred the antitrust regulator from launching the inquiry, marking a significant shift in the oversight of tech giants.

Overruling the CAT: Justice Green's Decisive Verdict

The panel of three justices unanimously overturned the Competition Appeal Tribunal's (CAT) decision, which had halted the CMA's market investigation initiated in 2022. This investigation aims to scrutinize the dominance of Apple and Alphabet browsers. Justice Nicholas Green played a pivotal role, criticizing the CAT's interpretation of the Enterprise Act 2002 as potentially crippling to the CMA's authority.

Apple's Challenge and the Legal Implications

Apple's argument that the CMA had missed the investigation deadline under the Enterprise Act 2002 was initially successful. However, this interpretation, as Justice Green highlighted, would severely limit the CMA's capacity to address concerns about Apple or Google's behavior, even if such concerns were objectively justified.

CMA's Freed Hand: Investigating Tech Giants' Dominance

The CMA now has the green light to delve into Apple's control over operating systems, app stores, and web browsers on mobile devices. This decision follows the CMA's 2022 announcement to address developer concerns that Apple and Google's restrictions stifle innovation and inflate costs.

The Duopoly Dilemma: CMA's Initial Findings

A previous market study by the CMA revealed a virtual duopoly by the two tech giants, allowing them to exert significant control over key digital platforms. Although the CMA identified grounds for an investigation, they initially delayed action, anticipating new authority through expected digital market legislation.

Resetting the Clock: Tribunal's Decision Overturned

Despite launching the investigation six months later, the CMA faced a setback when the CAT ended the probe, siding with Apple's argument about the missed statutory deadline. However, Justice Green's ruling underlines the necessity of the CMA's role in investigating potential legal breaches, rejecting the notion of a one-time-only investigation.

CMA's Response and Apple's Silence

CMA's chief executive, Sarah Cardell, welcomed the ruling, emphasizing its importance for consumer protection and competition promotion in the UK. Meanwhile, Apple has not yet commented on the latest development.

The CMA is represented by Rob Williams KC and David Bailey, instructed by in-house counsel. Apple's defense is led by Tim Otty KC and Tim Parker, instructed by Gibson Dunn & Crutcher LLP.