The antitrust regulators of the European Union are seeking information from online sale companies about whether they were either directed or asked to consider the mobile payment service of Apple Inc in place of similar payment apps of rival companies. This inquiry by the EU’s antitrust body is likely to result in woes for Apple.
The EU’s antitrust body had information about the possibility that online payments for the purchase of goods and services made via merchant apps or websites was restricted by Apple, said the European Commission to the online sale companies in a questionnaire that was sent to them in August. If the allegations against Apple hold true, it would be a breach of the EU antitrust rules which could attract a maximum fine of up to 4 per cent of the annual revenues of Apple under the new GDPR rules.
Apple Pay, Apple’s mobile payment service, was launched in October 2014 as a diversification of the company to create revenues sources in addition to hardware sale. The service is available across more than 50 countries worldwide which includes more than 20 countries in the EU.
The companies were asked in the questionnaire whether any form of contractual obligation had been placed upon them which would allow only a particular payment method and whether such contractual agreement also included conditions to force the online sale companies to integrate Apple Pay in their apps and websites.
EU regulators also wanted to know whether merchant apps were rejected as being incompatible with the terms and conditions by Apple with the aim of integration of the Apple Pay in their apps.
The Commission confirmed that it had sought information from market participants.
“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 competition enforcer said.
The safest and most secure solution in the market is offered by its payment system as evidenced by the thousands of banks using it, Apple said. “IPhone has completely transformed mobile payments by providing customers with a choice of how to pay including cash, credit card and debit card, as well using apps from the major banks and financial institutions,” it said.
It has been quite some time that complaints that the Apple iPhone have an inbuilt and embedded NFC chip that automatically makes Apple Pay the selected payment service in the case of an iPhone user paying for goods and services hereby preventing installation and use of any other payment methods. Some have also protested the incident of alerts being received on iPhones that ask users whether they would like to set up Apple Pay on their devices.
She might investigate Apple Pay if there are formal complaints, European Competition Commissioner Margrethe Vestager said in an interview with Reuters last year.
Apple is already at the centre of a complaint filed by Swedish music streaming service Spotify Technology SA alleging that Apple’s streaming service unfairly limits rivals. A decision by the European Commission about whether to open an investigation on the complaint is still pending.
(Adapted from Reuters.com)