Access to NFC technology like Apple Pay needs new rules, says Dutch body

"The investigation confirms the previously identified anticompetitive concerns on the Dutch market for payment apps."

What you need to know

  • A Dutch market authority says more rules are needed in the NFC payment market.
  • It could prompt a look at technology like Apple Pay.
  • The body says it welcomes further European rules to increase competition.

A Dutch market authority says further rules are needed to curb anticompetitive practices in the market of NFC payment technology on smartphones such as Apple Pay.

In a release published today the Netherlands Authority for Consumers and Markets stated:

The Netherlands Authority for Consumers and Markets (ACM) will close its investigation into payment apps' access to NFC technology installed in devices such as smartphones. NFC technology offers the ability to make contactless payments using smartphones in brick-and-mortar stores. The investigation confirms the previously identified anticompetitive concerns on the Dutch market for payment apps. However, the Interchange Fee Regulation (IFR), the European rules on the basis of which ACM conducted this investigation, is not suitable for alleviating these anticompetitive concerns in the Netherlands. That is why ACM is in favor of additional European rules.

The report says the investigation "has revealed that access to NFC technology (Near Field Communication) is an important prerequisite for market participants to invest in the development of payment apps of their own" because consumers can already pay for goods in brick-and-mortar stores using this technology using contactless bank cards.

Because market participants like banks don't have access to the technology on smartphones, the body says that they have not started developing for the tech.

"As a result thereof, consumers and retailers have fewer methods of payment to choose from."

The report says that the EU's IFR rules do not tackle the problem, because it relies on there being a choice between different payment apps, and "that choice currently does not exist in the Netherlands."

The body says it is in favor of amending EU rules to mandate that smartphone makers like Apple "offer access to crucial technology and infrastructure such as NFC technology."

In June of 2020 the EU announced a formal investigation into Apple Pay over allegations that Apple's limitation of access to NFC technology on the iPhone violates EU competition rules.

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