PayPal Helped Spur EU Antitrust Complaint Against Apple and its iPhone payments system
PayPal Holdings Inc. helped spur a formal antitrust complaint against Apple Inc. and its iPhone payments system.
PayPal Holdings Inc. helped spur a formal antitrust complaint against Apple Inc. and its iPhone payments system by raising concerns with the European Commission, according to people with knowledge of the matter.
European regulators hit Apple with a so-called statement of objections on Monday, arguing that the iPhone maker abuses its control over mobile payments. The complaint centers on the company reserving the iPhone's tap-to-pay abilities for its own Apple Pay service, rather than letting rival payment platforms use the feature.
PayPal, which has its own payment service, was one of multiple companies making informal complaints about the situation to the commission, said the people, who asked not to be identified because the discussions were private. PayPal offers a tap-to-pay option on Android phones and wants to be able to offer the same feature on Apple iPhone.
PayPal, based in San Jose, California, declined to comment.
Tap-to-pay services rely on a standard called NFC, or near field communications. Apple only lets its own payment system use the iPhone's NFC chip, hampering PayPal and other apps, including Square's Cash App and services from Samsung Electronics Co. and Alphabet Inc.'s Google.
This year, Apple will begin letting third parties use the iPhone's NFC chip to accept payments -- a feature geared toward small businesses -- but it still won't allow consumers with rival services to make payments that way. That situation creates an unequal playing field, the commission alleged in its complaint.
Apple has defended its approach by saying that Apple Pay rivals, including PayPal, are still popular on the iPhone -- even without a tap-to-pay option. It also said that Apple Pay already supports 2,500 banks in Europe. However, the company said it will “continue to engage with the commission to ensure European consumers have access to the payment option of their choice in a safe and secure environment.”
There's no formal complainant in the case, but a number of companies have expressed concerns about Apple's system over the course of the commission's investigation.
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