Technology
Friday, January 19th, 2024 4:47 pm EDT
Key Points
- Antitrust Compliance Efforts by Apple in Europe: Apple has taken steps to address antitrust concerns raised by European regulators regarding its contactless payment technology, Apple Pay. The European Commission, in 2022, identified potential anti-competitive behavior, noting that Apple’s exclusive control over its iOS operating system limited access to its payment technology for third-party mobile wallet developers. To address these concerns, Apple has offered commitments to grant third-party developers in the European Economic Area access to its mobile payment technology. The proposed changes include providing new features for users, such as defaulting to preferred payment apps, and implementing non-discriminatory eligibility criteria for rival developers.
- Terms of Apple’s Commitments and Regulatory Oversight: As part of its commitments, Apple has pledged to allow third-party developers to integrate with its mobile payment technology, particularly for NFC contactless payments, separate from Apple Pay and Apple Wallet. These commitments, if accepted, will be in effect for 10 years, according to the European Commission’s announcement. The Commission is currently seeking feedback on Apple’s proposals. If the commitments successfully address competition concerns, the Commission will adopt them and legally require Apple to implement the proposed changes. Failure to comply could result in fines, with Apple facing potential penalties of up to 10% of its total revenue.
- Antitrust Challenges in the U.S. for Apple: In addition to its efforts to address European antitrust concerns, Apple is also navigating regulatory pressure in the United States. The Department of Justice (DOJ) is reportedly preparing a case against Apple, focusing on alleged software and hardware limitations on iPads and iPhones that purportedly restrict competition. According to reports from Bloomberg, the DOJ is expected to file the antitrust suit against Apple within the first quarter. This signifies a broader global scrutiny of Apple’s business practices and potential legal consequences in both European and U.S. jurisdictions.
Apple has offered concessions to European antitrust regulators by proposing to grant rivals access to its contactless payment technology. Apple Pay, the company’s mobile wallet feature, allows iPhone users to make purchases by tapping their devices. The European Commission raised concerns in 2022, noting that Apple’s exclusive control over its iOS operating system limited third-party mobile wallet developers’ access to its payment technology, potentially restricting competition in the mobile wallet market. In response, Apple has committed to allowing third-party developers in the European Economic Area access to its mobile payment technology, introducing new user features like defaulting to preferred payment apps, and implementing non-discriminatory eligibility criteria for rival developers. These changes, if accepted, will be in effect for 10 years. The European Commission is currently seeking feedback on Apple’s proposals, and if approved, Apple will be legally obligated to implement the modifications. Failure to comply could result in fines of up to 10% of Apple’s total revenue. Concurrently, Apple faces antitrust scrutiny in the U.S., where the Department of Justice is reportedly preparing a case against the company. The U.S. case focuses on alleged restrictions imposed by Apple on competition through software and hardware limitations on iPads and iPhones. The Department of Justice is anticipated to file the suit within the first quarter, posing additional challenges for Apple on the regulatory front.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/01/19/apple-offers-rivals-access-to-tap-and-go-payments-in-eu-antitrust-case.html
