Suspicions of anti-competitive practices on Apple Pay in Europe

Apple is still in the sights of the European Commission. The latter has just shared the first conclusions of an antitrust case relating to Apple Pay on iOS devices. She informed the firm that she believed, on a preliminary basis, that the company was abusing its dominant position in the markets for mobile wallets on iOS devices. By limiting access to standard technology for making in-store contactless payments using mobile devices (“Near field communication (NFC)” or “tap and go”), the Cupertino restricts competition in the e-wallet market on iOS.

The case is challenging Apple’s decision to block mobile wallet app developers from accessing necessary hardware and software (“NFC input”) on its devices, in favor of its proprietary solution, Pay. Margrethe Vestager, Executive Vice President, Competition Policy, said, “Mobile payments are playing an increasingly important role in our digital economy. For the purposes of the integration of European payments markets, it is essential that consumers benefit from a competitive and innovative payments landscape. We have evidence indicating that [la firme] restricted third-party access to key technology needed to develop competing e-wallet solutions on Apple devices.

NFC technology made in Apple

Apple Pay is Apple’s proprietary solution for mobile wallets, offered on iPhones and iPads. Available from Apple Wallet, this application allows mobile payments to be made in physical and online stores. It replaces the physical cards that its users have since they are integrated into the app. The firm’s iPhones, iPads and software form a “closed ecosystem”, in which the firm can control every aspect of the user experience, including the access of e-wallet developers to said ecosystem.

In fact, Apple Pay is the only mobile wallet solution to have access to the necessary NFC technology on iOS. The latter is integrated into the brand’s mobile terminals and allows communication between a mobile phone and payment terminals, where it guarantees maximum security and fluidity. Compared to other solutions, we note that NFC enjoys wider acceptance in Europe. This is not the first time that we have noticed this locking at the firm: in France, Île-de-France Mobilités, which wishes to offer everyone the possibility of buying metro tickets, taking out a Navigo subscription and validating it. on their Apple devices, had to scramble to find a deal with the company. Using a Navigo pass on iOS goes through NFC.

The Commission is still chasing after Apple

In this way, the firm considerably restricts any incipient competition. “Such a situation produces crowding out effects for its competitors, weakens innovation and otherwise restricts consumers’ choice of these mobile wallets”. The European Commission specifies that “if confirmed, this behavior would be contrary to Article 102 of the Treaty on the Functioning of the European Union (TFEU), which prohibits the abusive exploitation of a dominant position on the market”. . It specifies that the sending of a statement of objections does not prejudge the outcome of an investigation.

In this press release, the Commission does not return to the online restrictions or denials of access to Apple Pay that certain specific products of competitors would suffer, about which the Commission expressed its concerns when it opened the in-depth investigation into Apple’s practices regarding Apple Pay on June 16, 2020.