Tech

Apple NFC Deal Opens EU Market, Avoids Fines

Apple agrees to open NFC technology to rivals, ending four-year EU antitrust investigation.

By Athena Xu

7/11, 05:34 EDT
Apple Inc.
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Key Takeaway

  • Apple agrees to open its NFC technology to rivals, addressing EU antitrust concerns and avoiding potential fines.
  • The commitments will last ten years, allowing European developers to offer various tap-and-go payment solutions on iOS.
  • This move is expected to enhance competition and innovation in the EEA mobile payments market.

EU Antitrust Investigation

EU antitrust regulators have concluded a four-year investigation into Apple’s mobile payments system, accepting commitments from the tech giant to open its tap-and-go technology to rivals. The European Commission formally launched the investigation in 2020, focusing on Apple Pay and the company's restrictions on third-party access to near-field communication (NFC) payments. Margrethe Vestager, the EU antitrust chief, stated, “The commission has decided to accept commitments offered by Apple. These commitments address our preliminary concerns that Apple may illegally have restricted competition when it comes to mobile wallets on iPhones.”

The investigation was driven by concerns that Apple was hindering competition by blocking rival mobile wallet developers from accessing its NFC technology, which allows for contactless payments. The EU competition enforcer charged Apple two years ago with these anti-competitive practices. The settlement reached on Thursday ensures that Apple’s final commitments will address these concerns, allowing third-party developers to access NFC payments in stores for European Economic Area (EEA) iOS users.

Apple’s Commitments

Apple’s commitments, which will be valid for ten years, include opening its NFC technology to European developers. This will enable them to offer tap-and-go payments for various applications, including car keys, closed-loop transit, corporate badges, home keys, hotel keys, merchant loyalty/rewards, and event tickets from within their iOS apps. The company’s offer aims to provide a level playing field for developers and enhance competition in the mobile payments market.

The European Commission’s acceptance of these commitments marks a significant step in addressing the competitive concerns surrounding Apple’s mobile payments system. The decision is expected to foster greater innovation and choice for consumers in the EEA, as developers will now have the opportunity to create and offer a wider range of mobile wallet solutions.

Impact on Apple

The settlement with the EU antitrust regulators allows Apple to avoid a potentially hefty fine that could have resulted from the investigation. By agreeing to open its NFC technology to rivals, Apple aims to comply with the EU’s competition rules and mitigate any further regulatory scrutiny. The company’s decision to offer these commitments reflects its willingness to address the concerns raised by the European Commission and ensure fair competition in the mobile payments market.

Apple’s move to open its NFC technology to third-party developers is also seen as a strategic decision to maintain its strong presence in the European market. By complying with the EU’s requirements, Apple can continue to offer its services without facing significant legal and financial repercussions. This decision is expected to have a positive impact on the company’s reputation and its relationship with regulators and consumers in the EEA.

Management Quotes

  • Margrethe Vestager, EU Antitrust Chief:

    "The commission has decided to accept commitments offered by Apple. These commitments address our preliminary concerns that Apple may illegally have restricted competition when it comes to mobile wallets on iPhones."