EU charge Apple Pay with abuse of market power

The European Commission has accused Apple of abusing its market position for contactless payments via its digital wallet app Apple Pay.

EU charge Apple Pay with abuse of market power

The EU regulator charged Apple with breaking competition law by abusing its dominant position to limit rivals’ access to contactless technology, as Brussels stepped up its challenge to one of the world’s largest tech groups.

Antitrust investigators are concerned that Apple is preventing competitors from accessing the NFC chip to benefit its own Apple Pay system, the European Commission said in its statement.

Margrethe Vestager, the commission’s executive vice-president in charge of competition policy, said Brussels had “indications that Apple restricted third-party access to key technology necessary to develop rival mobile wallet solutions on Apple’s devices”.

She told reporters: “On a preliminary basis, we have found that Apple abused its dominant position. Apple restricted access to key inputs that are necessary to develop and run mobile payment apps.”If confirmed, “such a conduct would be illegal under our competition rules”, Vestager added.

The company could face fines worth up to 10% of global turnover if the charges are upheld. Apple Pay is used on hundreds of millions of iPhones and the EU charge is the latest in several antitrust investigations opened against the tech giant in Brussels.

Apple is also facing scrutiny over the way it may be disadvantaging rivals on the App Store by taking 30% of some subscription fees while denying some services the option of telling users there are other ways of upgrading.

The case was opened after music streaming service Spotify complained to the commission more than two years ago.

The fresh charges come after Brussels approved two landmark pieces of legislation, including the Digital Markets Act, aimed at curbing the power of big tech groups. The legal curbs have made the EU the centre of a global regulatory crackdown on tech companies.

In its preliminary findings in the latest case, Brussels said it considered that Apple “enjoys significant market power in the market for smart mobile devices and a dominant position on mobile wallet markets”.

The findings of the investigation added: “Apple Pay is the only mobile wallet solution that may access the necessary NFC input on iOS. Apple does not make it available to third-party app developers of mobile wallets. The NFC ‘tap and go’ technology is embedded on Apple mobile devices for payments in stores.”

Apple said: “We designed Apple Pay to provide an easy and secure way for users to digitally present their existing payment cards and for banks and other financial institutions to offer contactless payments for their customers. Apple Pay is only one of many options available to European consumers for making payments, and has ensured equal access to NFC while setting industry-leading standards for privacy and security.”

More than 2,500 banks in Europe use Apple Pay and Apple smartphones represent around a third of the market across Europe.

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