Apple receives an EU Antitrust Charge over Mobile Payments

Apple was charged with antitrust violations by the EU for abusing its presiding position in the mobile wallets industry by suppressing competition. They had hampered competition in the mobile wallets sector, according to the EU, by restricting third-party access to crucial technology needed to develop competitor mobile wallet solutions on Apple‘s devices.

According to the reports, the company purposely denied application developers access to the hardware and software on its iPhones to benefit Apple Pay.

Apple Pay, the company’s mobile wallet solution for iPhones and iPads, allows users to make mobile payments in-store and online. In our digital economy, mobile payments are becoming increasingly important. “

A competitive and creative payments landscape is critical for the integration of European payments markets,” said Margrethe Vestager, the European Commission’s executive vice president in charge of competition policy.

“We discovered that they might have limited competition to boost its Pay system; such behavior would be prohibited under our competition rules if confirmed,” Miss Vestager added. Users’ credit or debit card information is stored in a mobile or digital wallet linked to a payment gateway to allow purchases.

They only work at merchants that accept them as a payment option, similar to credit cards. In 2011, Google was the first major corporation to develop a mobile wallet. Consumers can now choose from various digital wallets, including Samsung Pay, PayPal, and Apple Pay.

According to 2021 research by Juniper Research, consumer spending using digital wallets is predicted to reach more than $10 trillion in 2025. However, we are concerned that Apple may have distorted the market for mobile wallets on its devices illegally.

In a tweet, Margrethe Vestager stated, “Now Apple can clarify our concerns.” The company has previously claimed that the restrictions on Apple Pay were imposed due to security reasons.

According to the Commission, the anti-competitive actions began in 2015 with the launch of Apple Pay.

How does this affect Apple?

Based on last year’s revenue, it could be fined up to 10% of its global turnover, or $36.6 billion. However, maximum fines are rarely imposed by the EU. As a result, over 25,000 banks in Europe accept Apple Pay.

To defend its claims, the US-based firm might request a closed-door hearing. Then, before the Commission issues a ruling, it may also send a written response. The end of the probe has no legal date.

A US federal judge ordered Apple to accommodate app developers and ease its grip on in-app payments.

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