Business

EU targets Apple Pay in latest Big Tech antitrust case

Brussels accuses US tech giant of unfairly shielding its contactless payment system from competition

Updated 4 years ago · Published on 02 May 2022 7:51PM

EU targets Apple Pay in latest Big Tech antitrust case
Apple says that its first priority was security and that the Apple Pay system offered a level playing field between all actors using its products. – AFP pic, May 2, 2022

BRUSSELS – The EU accused Apple today of blocking rivals from its popular “tap-as-you-go” iPhone payment system, opening a fresh battlefront between the US tech giant and Brussels.

“The preliminary conclusion that we reached today relates to mobile payments in shops, by excluding others from the game,” said Margrethe Vestager, the EU’s antitrust chief.

“Apple has unfairly shielded its Apple Pay wallets from competition. If proven, this behaviour would amount to abuse of a dominant position, which is illegal under our rules,” Vestager told reporters.

The European Commission, the bloc’s competition watchdog, specifically charged the iPhone maker with preventing competitors trying to enter the contact-less market “from accessing the necessary hardware and software… to the benefit of its own solution, Apple Pay”.

The accusation is the latest salvo against US tech giants by EU regulators, who have also taken aim at Apple’s music streaming and e-book businesses.

The company is also a main target of the Digital Markets Act, a landmark EU law that will prohibit Apple and other US tech giants from privileging their own services in its products and platforms.

The EU’s outline of the case came after the commission launched an investigation in 2020 that was fuelled by complaints from European banks that resist paying a fee to Apple in order to reach their customers via apps.

The battle comes as tech giants eye personal finance as a new moneymaker, with Google, Amazon and Facebook owner Meta also seeking ways to replace credit cards or the need of carrying a wallet.

Launched in 2014, Apple Pay allows iPhone or Apple Watch users to make payments at retailers by touching their devices to the same terminals currently used for credit and debit cards.

‘Many options’

The technology at the heart of concerns in the Apple Pay case is “near-field communication”, or NFC, which permits devices to communicate within a very short range of each other, usually less than 10cm (four inches).

On iPhones, the use of NFC is blocked for payments except by Apple Pay and any company wanting to use the technology must pass through Apple for a fee.

Vestager said that by restricting the access to the NFC to themselves, “this market is really not developed because it’s not possible for other app developers to get access to the NFC.”

Apple said that its first priority was security and that the Apple Pay system offered a level playing field between all actors using its products.

“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,” the company said.

“We will continue to engage with the commission to ensure European consumers have access to the payment option of their choice in a safe and secure environment,” it added.

There is no deadline for the EU’s continued investigation. If found guilty, Apple would have to remedy its practices or face fines that could reach as high as 10% of annual sales. – AFP, May 2, 2022

Related News

Malaysia / 1d

Budget 2027: Civil servants to receive RM1,500 special aid; retirees, RM750

Malaysia / 1mth

Religious Affairs Ministry condemns Malaysian’s participation in Bangkok pageant

Malaysia / 2mth

‘We will respond after Kedah formally submits lease payment claims’ – Penang CM

Malaysia / 2mth

BNPL users hit eight million as outstanding balances reach RM5.3b

Events / 3mth

FWD Takaful fulfils zakat obligation to FT Islamic Religious Council Zakat Collection Centre

Malaysia / 4mth

Anwar - Sabah's special grant interim payment increased from RM600m to RM1.5b

Spotlight

Malaysia

Five fatal helicopter crash victims honoured in Sarawak state awards

Malaysia

No Malaysian is left behind; Budget 2027 puts people first - Anwar  

Malaysia

Panama hit by 6.4-magnitude earthquake

Malaysia

Haze blankets 33 areas with unhealthy air

Malaysia

Malaysia’s 2027 Budget is a steady one: people-oriented continuity rather than bold reform

Malaysia

Budget 2027: What is in it for me?

Malaysia

Budget 2027 steps up Sabah, Sarawak funding by RM2.2b amid push for development parity

Malaysia

Budget 2027: Maternity leave entitlement increased, minimum pension raised to RM1,350

You may be interested

Business

Budget 2027 channels RM270m to SMEs through crowdfunding, P2P financing

Business

Malaysia draws US$9.5b in orders for US$1.5b sukuk, cuts borrowing costs

Business

Budget 2027 targets foreign e-commerce platforms, channels billions into local firms and startups