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QUESTION Strawberry inc is a multi-national technology company headquartered in Durban, South Africa. They specialize in the manufacture of mobile devices and software development. They are considered one of the biggest global players in the industry selling their mobile devices within and outside the EU All of their devices run their own patented She herry uperating system and they manage an online app store where third party developers are able to upload their applications and make them available to Strawberry device consumers for download. The Strawberry App Store terms of use require third party developers to make use of Strawberry App Store's payment facility for all purchases related to their applications and for each transaction Strawberry Inc deducts 30% operating foC. A breach of this clause will result in immediate removal of a third-party app from the Strawberry App Store Strawberry Inc also blocks the installation of applications downloaded from any other App Store Nacle on their devices. Their reasoning for this is that they seek to protect their consumers' privacy and fecurity and allowing the installation of applications downloaded form a third-party store would market make it extremely difficult to carry out this task which they argue is one of the main reasons why consumers prefer their brand. The consumer rracy defense (C). However, in a widely publicized leak by a hacktivist group known as Big Tech Sucks, Strawberry Inc was shown to be discussing what are known as "sweethearn deals" with two of ce the biggest global streaming sites, Hotflix and Glued2Screen. Under these deals these two sites C. would be allowed to offer purchases related to their applications on their own payment mediums' and they would only pay a 10% fee if the Strawberry payment platform was used If these terms were agreed to Hotflix and Glued2Screen would provide their mobile applications exclusively on Strawberry devices and they would not be available on all other competing devices. The documents leaked show the CEO of Strawberry Inc explaining to the COO that these deals had become necessary because of the meteoric rise of online streaming during the COVID19 pandemic and Hotflix and Glued2Screen had threatened to remove their applications from the Strawberry platform if they did not secure a more favorable agreement. This caused an uproar in the developer community A consortium of developers known as Nerd Station demanded that Strawberry inc provide clarity on what basis they grant such sweetheart deals and if these deals would be available to all developers. Strawberry Inc did not amend their general terms of use to explain these deals and refused to comment arguing that they had no obligation to disclose their private business practices. Furthermore, a former Strawberry Inc employee in an interview on a popular news channel had -8xcd revealed that the CEO of Strawberry Inc was worried about consumers switching from their abuse un brand to a newer brand called ForThePeople based in Amsterdam which was a mobile development firm which ran an open source operating system called Liberty that allowed developers to offer in-app purchases using their own payment platforms and allowed the installation of applications from rival third party application stores. She revealed that the CEO had been engaging in talks on how to "put ForThePeople out of business before it became a real problem." In response to this interview Strawberry Inc argued that the other big firms in the mobile device industry carried out similar practices and while Strawberry Inc did have a significant share in the market, they did not possess enough market power to run ForThePeople out of business therefore min they did not violate competition law, they just came up with a superior business strategy Eventually Nerd Station employed your law firm to build an anti-trust case against Strawberry InC. You have been tasked with formulating a legal strategy outlining the violation of EU competition law by Strawberry InC. Write down your arguments justifying them adequately with Angthe relevant legal sources. Make it clear which rules Strawberry Inc is violating Near East University Law Faculty Prepared by TAFADZWA CHIGUMIRA
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Based on the information provided, it appears that Strawberry Inc may be violating EU competition law in several ways. Here are some potential arguments that could be made:1. Abuse of dominant position: Strawberry Inc is considered one of the biggest global players in the mobile device industry, which suggests that they have a dominant position in the market. By requiring third-party developers to use their payment facility and deducting a 30% operating fee, they may be abusing their dominant position by imposing unfair conditions on access to their market. This could be seen as a violation of Article 102 of the Treaty on the Functioning of the European Union (TFEU), which prohibits the abuse of a dominant position.2. Discrimination: Strawberry Inc's policy of blocking the installation of applications downloaded from any other app store on their devices could be seen as discriminatory and anti-competitive. This could be a violation of Article 101 of the TFEU, which prohibits agreements and practices that restrict competition. By limiting consumers' ability to access a wider range of applications, Strawberry Inc may be restricting competition and reducing consumer choice.3. Anti-competitive agreements: The "sweetheart deals" discussed between Strawberry Inc and Hotflix and Glued2Screen could be seen as anti-competitive agreements that restrict competition. By offering these deals exclusively on Strawberry devices, they may be limiting the availability of these applications on competing devices and reducing competition in the market. This could be a violation of Article 101 of the TFEU.4. Monopolization: The former Strawberry Inc employee's statement that the CEO was worried about consumers switching to ForThePeople and engaging in talks to "put ForThePeople out of business" suggests that Strawberry Inc may be attempting to monopolize the market. This could be a violation of Article 102 of the TFEU, which prohibits the abuse of a dominant position.In order to build a strong legal case against Strawberry Inc, it would be important to gather evidence and testimony to support these arguments. This could include gathering evidence of the company's market dominance, demonstrating the unfair conditions imposed on third-party developers, and showing the anti-competitive effects of their policies. Additionally, it would be important to compare Strawberry Inc's practices to those of other companies in the industry to demonstrate that their actions are not in line with industry standards.