Apple opens Nfc payments on iPhone to third parties: agreement with European Commission

The EU Commission has accepted Apple's offer to open up access for rivals to the 'tap and go' technology on iPhones used for contactless payments using NFC technology. The commitments 'address the concerns' raised by Brussels regarding competition.

Brussels' decision "opens up competition in this crucial sector, preventing Apple from excluding competitors" who "will henceforth be able to compete effectively with Apple Pay for iPhone payments" by giving consumers more choice, emphasised EU antitrust chief Margrethe Vestager, pointing out that Apple's commitments are "binding".

Apple Pay is the mobile wallet used to allow iPhone users to pay with their devices in shops and online. Apple's iPhones run exclusively on Apple's iOS operating system. Apple controls every aspect of its ecosystem, including the terms of access for mobile wallet developers. The Commission has made a preliminary finding that Apple has significant market power in the market for smart mobile devices and a dominant position in the market for in-store mobile wallets on iOS.

Apple Pay is the only mobile wallet that can access the Nfc hardware and software on iOS to make payments in shops, as Apple does not make it available to third-party mobile wallet developers. In its investigation, the Commission had preliminarily concluded that Apple abused its dominant position by refusing to provide Nfc input on iOS to competing mobile wallet developers, reserving access only to Apple Pay.

The Commission's preliminary view is that Apple's refusal excluded Apple Pay's rivals from the market and led to less innovation and choice for iPhone mobile wallet users. Apple modified its initial proposal and committed, among other things, to extend the possibility of initiating payments with Hce payment apps to other certified terminals, such as merchants' phones or devices used as terminals (so-called SoftPos), if enabled; to explicitly recognise that Hce developers are not prevented from combining the Hce payment function with other Nfc functionality or use cases; to remove the requirement for developers to have a licence as a payment service provider (PSP) or a binding agreement with a PSP to access Nfc input.