According to persons familiar with the situation, Apple will face an EU antitrust case over its NFC chip technology, putting it at danger of a potentially large fine and forcing it to open up its mobile payment system to competitors.
Since June of last year, when Margrethe Vestager initiated an inquiry into Apple Pay, the iPhone maker has been in the crosshairs of European Union antitrust commissioner Margrethe Vestager.
Apple’s NFC chip, which enables tap-and-go payments on iPhones, the company’s terms and conditions for how mobile payment service Apple Pay should be used in merchants’ apps and websites, and the company’s refusal to allow rivals access to the payment system were among the initial worries.
According to one of the sources, the European Commission has reduced its emphasis to just the NFC chip, which can only be accessible by Apple Pay.
According to one of the individuals, the EU competition enforcer is currently developing a charge sheet known as a statement of objections, which might be handed to Apple next year. Typically, such documents lay out activities that the regulator deems anti-competitive.
The Commission, which is now investigating Apple in three other cases, has declined to comment. For breaking EU guidelines, firms can be fined up to 10% of their global turnover, which, based on Apple’s 2020 revenue, could amount to $27.4 billion.
Apple was not immediately available for comment, citing privacy and security concerns in its Apple Pay policy.
In early trading, Apple’s stock was down 1% at $139.6.
Because to the COVID-19 epidemic, NFC-enabled payments have gained in popularity. According to some analysts, Apple Pay’s broad reach and greater consumer experience on a mobile website or in stores offer it a competitive advantage over competitors.
Other agencies and authorities are also keeping an eye on Apple Pay. Last month, South Korea passed legislation prohibiting large app store operators, such as Apple, from requiring software developers to utilize their payment methods.
In 2019, Germany approved legislation mandating Apple to offer its mobile payments system to competitors for a price.
The Dutch competition watchdog launched an investigation into the App Store and its requirement that app makers use its payment systems for in-app purchases and pay a 30% fee in the first year.