Since 2019, PayPal has filed several complaints with the European Commission to denounce Apple’s practices regarding its mobile payment system. The American online payment giant has finally been heard.
After the showdown between Apple and Spotify, will the Cupertino company find itself at the heart of a new battle? This time, the attacker is called PayPal. Since 2019, the American online payment giant has filed several complaints with the European Commission to denounce Apple’s practices regarding its mobile payment system.
In these complaints, PayPal believes that the Apple brand is hindering competition by preventing third-party developers from accessing the NFC chip on its iPhones. This makes it impossible for other companies to offer their own contactless payment functionality, such as PayPal’s tap-to-pay, directly to their iOS users. In this way, Apple rules out any competition in the mobile payment market.
The Commission raises its voice
According to sources familiar with the matter cited by Bloomberg, the concerns raised by PayPal ended up encouraging the European Commission to formally slap on the fingers of Apple for its use of Apple Pay. In a press release, Brussels estimated that the Californian company “abused its dominant position in the markets for mobile wallets on iOS devices” by preventing “developers of mobile wallet applications to access the necessary hardware and software (“NFC input”) on its devices, for the benefit of its proprietary solution, Apple Pay”.
By formalizing its accusations against the American group, the European Commission is paving the way for a fine that could reach up to 10% of Apple’s worldwide turnover. “In our statement of objections, we considered, on a preliminary basis, that Apple may have restricted competition, to the benefit of Apple Pay, its proprietary solution. If confirmed, such behavior would be illegal under our competition rules”, said Margrethe Vestager, executive vice president in charge of competition policy. In this context, a conviction would constitute the end point of a file opened in 2020.
Tim Cook castigates DMA
Accused of drastically limiting access to the iPhone’s NFC chip and the Apple Pay service, the American giant invokes privacy and security reasons. By opening its NFC chip to the four winds, the Cupertino company fears that malicious people will take advantage of it to circumvent the defense systems put in place by Apple.
Tim Cook has also been very critical of the Digital Markets Act (DMA), a text which aims to put an end to the unfair practices of digital giants. In the eyes of the boss of Apple, this new legislation, adopted in Brussels, would allow “data-hungry companies to evade our privacy rules and, once again, track our users against their will”. Arguments which are not admissible for the European Commission, and which have pushed Brussels to seize the subject with a view to a possible sanction.