European Commission launches competition probe over Apple Pay system
EUROPEAN Competition Commissioner Margrethe Vestager’s office has opened an investigation to assess whether Apple Pay violates EU rules.
The high-profile Commission vice president is best known for the record-breaking €13bn back-taxes bill levelled against Apple four years ago.
Now, she says her agency has concerns that Apple’s terms, conditions and other measures related to the integration of its electronic payment service Apple Pay may distort competition and reduce choice.
The probe was triggered by a complaint from Swedish music streaming service Spotify last year. Another smaller rival also filed a similar grievance related to e-books and audiobooks in March this year.
Apple Pay is the only mobile payment solution that may access the tap-and-go technology on iPhones for payments in stores.
The investigation will also examine alleged restrictions of access to Apple Pay for specific products of its rivals.
Apple, which employs more than 6,000 people in Cork, is currently in the European courts appealing the €13bn tax judgment made against it by the Commission.
The Irish Government has also launched a legal challenge against the 2016 ruling, in which the EU Commission found that Apple had benefited from illegal state aid as a result of two Irish tax rulings which artificially reduced the tech giant’s tax burden for more than two decades.
With the European Commission, Apple and the Irish Government at loggerhead, the €13bn is currently in an escrow account controlled by Ireland.
In the latest clash between Apple and the Commission, Brussels said it will investigate the possible impact of the tech giant’s practices on competition in providing mobile payments solutions.
If proven, the practices under investigation may breach EU competition rules on anti-competitive agreements between companies and/or rules on the abuse of a dominant position.
“It appears that Apple obtained a ‘gatekeeper’ role when it comes to the distribution of apps and content to users of Apple’s popular devices,” Commissioner Margrethe Vestager said.
“It is important that Apple’s measures do not deny consumers the benefits of new payment technologies, including better choice, quality, innovation and competitive prices.”
Launched in 2014, Apple Pay marked the company’s diversification from sales of devices such as iPhones and iPads.
Commenting on the probe, Apple said it follows the law “in everything we do and we embrace competition at every stage because we believe it pushes us to deliver even better results”.
“It’s disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don’t want to play by the same rules as everyone else,” the company said.
“We don’t think that’s right — we want to maintain a level playing field where anyone with determination and a great idea can succeed.”
Meanwhile, EU competition regulators will decide by July 20 whether to clear Alphabet-owned Google’s $2.1bn (€1.86bn) bid for fitness trackers company Fitbit, a deal that has prompted concerns from consumer groups and privacy advocates.