July 21, 2024

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EU says in preliminary ruling that Apple Pay is uncompetitive

EU says in preliminary ruling that Apple Pay is uncompetitive

Apple has been accused of antitrust by the European Union for excluding competitors from the mobile payment system Apple Pay. The European Union sent Apple a formal “Statement of Objections” with a preliminary view that Apple has abused its dominant position in iOS mobile wallets.

“The panel takes issue with Apple’s decision to prevent mobile wallet app developers, from accessing necessary hardware and software (“NFC input”) on its devices, in favor of its own solution, Apple Pay,” reads the resolution. “Today’s statement of objections relates only to accessing NFC inputs by third-party developers to mobile wallets for in-store payments.”

According to the European Union, Apple’s exceptional behavior “leads to less innovation and consumer choices for mobile wallets on iPhones.”

This is only the initial formal stage of antitrust proceedings against Apple, and the company will have the opportunity to respond to the commission’s list of objections. The EU notes that sending a statement of objections “does not prejudge the outcome of the investigation”.

“Apple Pay is just one of many options available to European consumers to make payments, and has ensured equal access to NFC while setting industry-leading standards for privacy and security,” Apple spokeswoman Hannah Smith said in a statement. the edge. “We will continue to engage with the Commission to ensure that European consumers have access to the payment option of their choice in a safe and secure environment.”

Today’s ruling came on the heels of last year’s accusations to the company Competing music streaming services are unfairly punished. The European Union has the power to impose fines of up to 10 percent of Apple’s global revenue ($36 billion) as well as impose changes to the company’s business practices. In practice, though, any favorable fines against Apple’s potential appeal of the charges would be much lower.

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The Commission’s initial view against Apple shows once again that the European Union is leading the way in attempts to rein in the power of big tech companies. In the past weeks, the conglomerate has passed two major legislative acts aimed at countering the negative effects of the digital giants. here they are Digital Services Act (DSA)which forces companies to tighten control over harmful content on their platforms, and Digital Markets Act (DMA)which aims to achieve business equality, allowing small companies to compete with the largest companies.

Apple has contested a number of provisions set by the European Union, particularly those that loosen the company’s control of the App Store (from which Apple raises significant revenue).

Update May 2 2:15 PM ET: Updated to add a statement from Apple.