Vice President Margrethe Vestager justifies the action of the EU Commission.
(Photo: AP)
Brussels According to the EU Commission, it is probably illegal that iPhones cannot be used to download apps that allow contactless payment. According to a preliminary analysis, Apple has exploited its market dominance. The company can now respond. If the EU Commission then sticks to its assessment, a penalty would be due.
The Commission “preliminarily notes that Apple may have restricted competition in favor of its own Apple Pay solution,” said Commission Vice-President Margrethe Vestager. “Such conduct would be a violation of our competition rules.”
Specifically, it is about paying by near field communication (NFC for short). For example, the data of a credit card is stored on the mobile phone. The mobile phone can then be used as a credit card by holding it up to a reader in the supermarket, for example. This function can be used on Android phones via various apps, providers include banks, Samsung, Paypal or the Android manufacturer Google itself.
On Apple’s iPhones, there is only the in-house “Apple Pay” app. The NFC chip cannot be used by other providers. “This shuts out other competitors from the iPhone mobile wallet market, which hampers innovation and reduces consumer choice,” the Commission said in a statement.
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Such innovations could exist, for example, in offers where the customer pays his bills later or which help him to keep track of his transactions. Theoretically, credit cards from banks with which Apple has not previously worked could also be used in this way.
Apple emphasizes security
The competition case was not triggered by complaints from disadvantaged companies. However, app developers and banks are said to have been dissatisfied with the fact that they cannot offer their services on iPhones.
>> Read here: New EU internet rules: How Apple, Google and Amazon must change now
The expected fine shouldn’t be particularly high since the market is still small and Apple is likely to only receive a very small amount per transaction. Neither the Commission nor Apple wanted to give any figures.
Apple only defended itself with a reference to the security of its services and alternative offerings: “Apple Pay is just one of many options available to European consumers for payments and has ensured equal access to NFC while maintaining industry-leading standards set for privacy and security.”
In other words, even those who use an iPhone can still pay in cash, by card or via QR codes and on Apple Pay. However, the EU Commission wants payment via NFC to be possible without using Apple Pay.
Law to force access to NFC chips
The procedure is just one of many initiatives with which the EU Commission is taking action against the closed iOS system. In another cartel case, the Brussels authority accuses Apple of impeding competition in music streaming. The provider Spotify had complained about unfair conditions that gave Apple Music an advantage.
Such behavior should be generally prohibited for very large companies in the future. The law on digital markets (“Digital Markets Act”) is scheduled to come into force in the course of the year and will make the time-consuming antitrust checks superfluous.
The previous charging sockets on iPhones should also look different in the future. EU legislators recently agreed a law that requires cell phones to be USB-C rechargeable. That should mean the end of Apple’s Lightning connector in Europe.
More: Europe’s antitrust watchdog is fighting Google with new weapons