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EU Commission Enforces Legally Binding Commitments on Apple Under Antitrust Rules

By  |  July 14, 2024
Regulators Find New Evidence in Apple Antirust Case

The European Commission has announced a decision, making Apple’s commitments on contactless payments legally binding under EU antitrust rules. This move aims to address competition concerns related to Apple’s previous refusal to grant rivals access to the standard technology used for contactless payments on iPhones, commonly known as Near-Field Communication (NFC) or “tap and go.”

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    In a statement, EU Commissioner for Competition Margrethe Vestager highlighted the significance of this decision. “These commitments address our preliminary concerns that Apple may have illegally restricted competition for mobile wallets on iPhones,” Vestager remarked.

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    Vestager elaborated on Apple’s creation of a “closed ecosystem” around its devices and operating systems, within which multiple markets for services, including mobile payment apps or “mobile wallets,” operate. These mobile wallets enable payments via mobile devices in both physical stores and online, and often incorporate additional services like loyalty cards, contactless event tickets, boarding passes, and digital identity credentials.

    The EU’s preliminary findings in 2022 concluded that Apple had abused its dominant market position by restricting access to the NFC technology essential for making payments with iPhones. “NFC technology was not developed by Apple. It is a standardised technology,” Vestager noted, adding that the investigation led to three key conclusions:

    1. Apple holds a significant position in the market for smart mobile devices.
    2. Apple is dominant in the market for NFC functionalities and mobile wallets for iPhones.
    3. Apple refused to give access to the NFC technology on the iPhone to rival wallet developers, reserving its use for its own mobile wallet solution.

    Vestager asserted that Apple’s behavior prevented developers from offering new and competitive mobile wallets to iPhone users, effectively shielding its own mobile wallet from competition.

    The commitments made by Apple effectively end the EU’s investigation into Apple Pay. “Thanks to these commitments, iPhone users will be able to use their preferred mobile wallet for payments in stores,” Vestager said. “They will be able to do so while enjoying all the iPhone’s functionalities, including tap-and-go, Double-Click, and FaceID. Finally, the commitments will apply in parallel to Apple’s obligations under other regulations.”

    Apple’s commitments include allowing third-party wallet providers access to the NFC input on iOS devices free of charge, without the requirement to use Apple Pay or Apple Wallet. Additionally, Apple will apply a fair, objective, transparent, and non-discriminatory procedure and eligibility criteria to grant NFC access to third-party mobile wallet app developers.