In a significant development aimed at resolving a long-standing antitrust investigation by the European Commission, Apple has agreed to grant third-party mobile wallet and payment providers access to the iPhone's NFC capabilities.
The Commission, currently seeking public input on these commitments, views this as a crucial move that would dismantle the exclusive access enjoyed by Apple Pay and Apple Wallet over the iPhone's NFC payment features.
What Apple Said About the Antitrust Allegations
Based on a new proposal in line with European Commission antitrust probe, Apple has offered to give access to third-party payment cards without using Apple Pay.
According to 9to5Mac, the proposed concessions come more than a year and a half after the European Commission formally accused Apple of employing restrictive iOS policies, inhibiting competition within the mobile payments sector, and violating EU law.
The Commission specifically objected to Apple's decision to block mobile wallet app developers from accessing essential hardware and software (NFC input) on its devices, favoring its proprietary solution, Apple Pay.
While Apple allows third-party app developers to leverage the iPhone's NFC features for reading electronic tags, it confines the capability to make payments over NFC to its own software.
The recent move follows Reuters' report in December, signaling Apple's intention to open its tap-to-pay hardware to competitors.
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Apple's Commitments and Implications
In response to ongoing discussions with the European Commission, Apple has put forth commitments offering third-party developers in the European Economic Area an option to allow their users to execute NFC contactless payments within their iOS apps, distinct from Apple Pay and Apple Wallet.
These commitments, if accepted, would be effective for a decade, with potential penalties, including fines of up to 10% of Apple's global annual turnover, for non-compliance, per The Verge.
While the details of these commitments do not explicitly mention applicability beyond the EU, the Commission's press release hints that someone with an Apple ID registered in the European Economic Area could utilize third-party apps for NFC payments outside the bloc.
Broader Antitrust Scene
This move comes on the heels of a meeting between the European Commission's antitrust lead, Margrethe Vestager, and Apple CEO Tim Cook in California.
Beyond the NFC concessions, the EU's antitrust investigations have targeted various Apple services, including Apple Pay. The Commission has also aligned itself with Spotify, challenging App Store rules restricting developers from advertising app subscriptions outside Apple's ecosystem. A final decision, along with potential fines and restrictions, is anticipated later this year, as reported by Bloomberg.
Currently, the European Commission wants to hear the feedback from customers and competitors on concessions that the iPhone maker offered. They are given one month to give feedback.
In 2023, Apple allowed PayPal users to add debit or credit cards to Apple Wallet.
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