After European Union antitrust officials accused Apple of preventing rivals' use of its digital wallet technology, the tech giant might face a huge punishment and be forced to expose its mobile transaction system to outsiders.
This is Apple's second EU allegation, following a petition from Spotify last year when EU regulators accused the corporation of impeding competition in the music streaming industry.
Yesterday, the European Commission announced that it had handed Apple a court document, also known as a statement of objections, explaining how the corporation had exploited its dominant status in markets for mobile wallets on iOS gadgets.
Apple's anticompetitive conduct, according to the EU, traces its origins to the debut of Apple Pay in 2015.
Apple's anti-competitive activities, according to the Commission, began in 2015, when Apple Pay was introduced.
In a statement, EU antitrust chief Margrethe Vestager noted, "We have evidence that Apple limited third-party entry to essential technology essential to building competitor mobile wallet options on Apple's gadgets."
Vestager added that they ﬁrstly determined in their statement of objections that Apple may have hindered rivalry to the advantage of its own system, Apple Pay.
Apple said it will continue to work with the Commission, which could sanction it up to 10% of its worldwide turnover, or $36.6 billion, based on its income last year, but EU sanctions seldom reach that level.
Apple Pay is just one of many payment alternatives accessible to European consumers, according to the company, which has guaranteed fair access to NFC while maintaining industry-leading security and privacy measures. Apple's Frankfurt-listed shares declined 0.7% as a result of the statement.
Apple Pay is accepted by approximately 2,500 European banks, as well as roughly 250 fintech and competitor banks. On iPhones and iPads, the NFC processor allows tap-and-go transactions.
Vestager, on the other hand, dismissed the company's claim of security, "To date, our inquiry has shown no evidence that would lead to such a heightened security risk; in fact, information in our file suggests that Apple's behavior cannot be explained by security issues."
Even before the Commission issues a ruling, Apple can request a private meeting and file a written rebuttal, which might take another year or more.
The Digital Markets Act, which would require Apple to start opening its closed environment or face fines of up to 10% of its global turnover, will be implemented by the EU next year.
If the claims against Apple are sustained, the commission did not specify how much the fines may be.