PayPal Helped Spur EU Antitrust Lawsuit Against Apple Payments
PayPal Holdings Inc helped fuel a formal antitrust complaint with Apple Inc and its iPhone payment system by alerting the European Commission, according to people who knew about the matter.
European regulators attacked Apple in a so-called statement of objections on Monday, arguing that the iPhone manufacturer abused its control over mobile payments. The complaint focuses on the fact that the company reserves the right to pay by touching the iPhone for its own Apple Pay service, instead of using competing payment platforms.
PayPal, which has its own payment service, is one of several companies that have made informal complaints about the commission’s situation, people have said and asked for anonymity because the discussions are private. PayPal offers the option of paying by tapping on Android phones and wants to offer the same feature on Apple’s iPhone. San Jose, California-based PayPal declined to comment.
Click-to-pay services are based on a standard called NFC, or Near Field Communications. Apple has only allowed its own payment system to use an iPhone NFC chip that blocks PayPal and other applications, including Square’s Cash and Samsung Electronics Co. services. and Google from Alphabet Inc.
This year, Apple will begin allowing third parties to use the iPhone’s NFC chip to accept payments, a feature aimed at small businesses, but it should still allow consumers to compete. This situation is causing a dishonest game, the commission said in its complaint. Apple defends its approach by saying that Apple Pay’s competitors, including PayPal, remain popular on the iPhone, even without the ability to pay by clicking. He also said that Apple Pay already supports 2,500 European banks. However, the company said it “will continue to work with the Commission to ensure that European consumers have access to the payment options of their choice in a safe and secure environment”.
There was no formal spokesman in the case, but several companies raised concerns about the Apple system during the commission’s investigation.