Report: EU Antitrust Officials Are Looking Into Apple Pay, iPhone NFC Chips

Photo: Michael Short, Getty Images

Officials across the European Union have already made their thoughts on Facebook’s Libra cryptocurrency project clear. Now those concerns have extended to Apple Pay, with EU antitrust chief Margrethe Vestager’s office probing whether the company’s pre-installed mobile payments software is playing dirty with the competition, Bloomberg reported on Thursday.

European Commission officials asked mobile-payments providers, banks and app developers in September “about how Apple Inc. devices may favour Apple Pay over other payment solutions,” Bloomberg wrote, citing MLex. In an email statement to Bloomberg, regulators confirmed the office was monitoring “possible anti-competitive market practices and abusive conduct” without naming Apple.

“In this context, the commission is actively monitoring the development of mobile payment solutions, the behaviour by operators active in the payments sector, including mobile payments,” the EU wrote.

According to MLex, the issue centres on Apple’s proprietary Near-Field Communication (NFC) chip, which Apple Pay relies on to enable users to pay at stores by just holding their phones near a card reader. Last year, Vestager said she was aware of reports that Apple was limiting use of the NFC chip to only cards included in Apple Wallet. No such restrictions on NFC permissions for cards or banking apps exist on Android.

Competitors have also complained that Apple refuses to allow competing payment methods into Apple Wallet, as well as the way that the iPhone automatically prompts users with Wallet and Apple Pay interfaces when an NFC signal is received, MLex reported. According to 9to5Mac, while Apple has eased up on some NFC restrictions, other apps have to be manually opened to the foreground to receive NFC signals.

No official investigation is yet underway, and EU regulators could decide to drop the matter. But services like mobile payments have become a cornerstone of Apple’s strategy in an era of declining device sales, with CEO Tim Cook recently saying that Apple Pay’s growth is adding users and growing monthly transaction volumes faster than PayPal. 

Carnegie Mellon University Tepper School of Business’s Tim Derdenger recently told Quartz that Apple is obviously restricting the feature for its own benefit, because “They don’t want rivals launching a wallet. If they opened it up, it would mitigate their market position.”

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