In a significant development for mobile payments systems, Apple Inc. (NASDAQ:AAPL) is expected to receive approval from European Union antitrust regulators as early as next month for its proposal to open up its near-field communication (NFC) technology to competitors. The move comes after the company tweaked some of the terms following feedback from rivals and customers.
The decision marks the end of a four-year investigation by the European Commission, which had previously accused Apple of stifling competition by restricting access to tap-and-go technology for mobile wallets. By settling the case, Apple will avoid accusations of wrongdoing and a potential fine of up to 10% in global annual revenue.
Apple's NFC, integral to its Apple Pay mobile wallet, facilitates contactless payments. In January, Apple proposed allowing competitors to access its NFC on various Apple devices, including iPhones and iPads, for free. This access would be granted without any obligation to use Apple Pay or Apple Wallet and would be based on fair, non-discriminatory criteria.
Additional features offered by Apple include the ability to set preferred payment apps as default, access to authentication features like FaceID, a suppression mechanism to prevent unwanted notifications, and setting up a dispute resolution mechanism.
The proposal, which was set to last for 10 years, has been revised by Apple to address concerns from competitors and customers. The European Commission is aiming to accept the proposal before the summer, with May being the most likely timeframe, although the exact timing could change as Apple finalizes the technical details.
The development follows a recent EU antitrust penalty against Apple, where the company was fined €1.84 billion ($2 billion) for restricting competition in the music streaming market, affecting companies like Spotify (NYSE: SPOT). The fine, issued last month, represents Apple’s first antitrust penalty.
Approval of Apple's NFC access proposal is expected to reshape the mobile payments landscape in Europe by fostering a more competitive environment and providing consumers with more payment options.
Source: Investing
