Apple Pay

European Commission says Apple Pay is anticompetitive.

The European Commission has informed Apple of its preliminary conclusion that it misused its dominant position in the market for iOS mobile wallets. Apple inhibits competition in the mobile wallets industry on iOS by limiting access to a standard technology used for contactless payments with mobile devices in stores (‘Near-Field Communication (NFC)‘ or ‘tap and go’).

The Commission is concerned about Apple’s decision to deny mobile wallet app developers access to the essential hardware and software (‘NFC input’) on its devices in order to promote Apple Pay.

Mobile payments play a rapidly growing role in our digital economy. It is important for the integration of European Payments markets that consumers benefit from a competitive and innovative payments landscape. We have indications that Apple restricted third-party access to key technology necessary to develop rival mobile wallet solutions on Apple’s devices. In our Statement of Objections, we preliminarily found that Apple may have restricted competition, to the benefit of its own solution Apple Pay. If confirmed, such a conduct would be illegal under our competition rules.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said

Statement of Objections on Apple’s access restrictions to mobile payment technology

Apple Pay is Apple’s mobile wallet app for iPhones and iPads, which allows users to make mobile payments in stores and online. Apple has created a “closed ecosystem” with its iPhones, iPads, and software. Apple has complete control over the user experience in this ecosystem, including access to mobile wallet developers.

According to the Commission’s preliminary findings, Apple has significant market strength in the market for smart mobile devices and a strong position in the market for mobile wallets.

Apple Pay is the only mobile wallet option on iOS that can access the required NFC input. Apple does not make it available to third-party mobile wallet app developers. Apple mobile devices include NFC ‘tap and go’ technology built-in enabling in-store payments. This technology allows a mobile phone to communicate with payment terminals in stores. NFC is a standard that enables for the safest and most smooth mobile payments. It is found in practically all payment terminals in stores. NFC provides a more seamless and secure payment experience than previous options, and it is more widely accepted in Europe.

The Commission’s preliminary view is that Apple’s dominant position in the market for mobile wallets on its operating system iOS, restricts competition, by reserving access to NFC technology to Apple Pay. This has an exclusionary effect on competitors and leads to less innovation and less choice for consumers for mobile wallets on iPhones. If confirmed, this conduct would infringe Article 102 of the Treaty on the Functioning of the European Union (‘TFEU’) which prohibits the abuse of a dominant market position.

The sending of a Statement of Objections does not prejudge the outcome of an investigation.

Today’s Statement of Objections takes issue only with the access to NFC input by third-party developers of mobile wallets for payments in stores. It does not take issue with the online restrictions nor the alleged refusals of access to Apple Pay for specific products of rivals that the Commission announced that it had concerns when it opened the in-depth investigation into Apple’s practices regarding Apple Pay on 16 June 2020.

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