Apple has agreed to open up its Near-Field Communication (NFC) technology to
third-party mobile wallet providers
, ending the exclusivity of
Apple Pay
and Apple Wallet. This move is aimed at resolving its
antitrust case
with the
European Commission
and avoiding a potential fine. The Commission is currently seeking feedback on these commitments, which would resolve this four-year-old investigation.
Around one and a half years after being formally accused of violating
EU
law by using its
iOS
policies to limit competition in the mobile payments market, Apple has proposed commitments to the European Commission.
The Commission launched an investigation against Apple in 2020, suspecting that the company restricted access to necessary technology for rival mobile wallet pay developers, thereby eliminating competition for Apple Pay. In 2022, the Commission charged Apple with violating EU antitrust laws, which, if proven, could have resulted in a significant penalty for the iPhone maker.
What Apple has to say
“Through our ongoing discussions with the European Commission, we have offered commitments to provide third-party developers in the European Economic Area with an option that will enable their users to make NFC contactless payments from within their iOS apps, separate from Apple Pay and Apple Wallet,” Apple said in a statement to the Wall Street Journal.
According to the commission, Apple has agreed to provide "equivalent access" to NFC components called "Host Card Emulation (‘HCE’) mode". This will securely store payment credentials and complete transactions using NFC. However, third parties will not gain access to Apple's secure element.
Apple will apply these proposed commitments to all third-party mobile wallet app developers in the European Economic Area and all iOS users with an Apple ID registered in the region. Non-EEA users would still be able to use third-party apps for store payments, and Apple says it will not stop them.
Additionally, Apple has pledged to provide third parties with additional functionality, including defaulting of preferred payment apps and access to authentication features. The company has also committed to fair and objective eligibility criteria for granting NFC access to third parties, who must enter into an ADP licence agreement. Also, it has agreed to set up a dispute settlement mechanism to review independent experts' NFC input access denials.
The European Commission is seeking feedback on proposed commitments and has opened a one-month consultation period with Apple’s rival services. If these commitments are accepted, they will be enforced for ten years. If Apple fails to honor these commitments, it may result in a fine of up to 10% of its worldwide turnover.
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