Technology giant Apple has made concessions in a long-running dispute with Brussels over its one-touch payment system. The firm will now allow rival companies access to its system for in-store payments.The European Commission on Thursday said it would accept commitments by Apple to open up its phone-based checkout payment system to third parties.

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Brussels has accused Apple of blocking rivals from its popular iPhone 'tap and go' payment system in a way that breaches EU competition law.

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The agreement ends a lengthy investigation in a case that dates back to 2022 and spares Apple a heavy fine.

What the EU said about the changes

"Apple has committed to allow rivals to access the 'tap and go' technology of iPhones. Today's decision makes Apple's commitments binding," EU competition chief Margrethe Vestager said in a statement.

"From now on, competitors will be able to effectively compete with Apple Pay for mobile payments with the iPhone in shops. So consumers will have a wider range of safe and innovative mobile wallets to choose from," she said.

The EU had previously ruled that Apple was taking advantage of its dominant position by restricting access to "tap-as-you-go" chips for near-field communication (NFC). The restrictions were deemed to favor the company's own Apple Pay system.

What happens next?

The standard technology behind contactless payments, which allows devices to interconnect within a very short range, will now be available to competitors on Apple phones.

The alternatives will be available to Apple registered throughout the European Economic Area, which the EU plus Iceland, Liechtenstein, and Norway.

Apple had risked a fine of up to a tenth of its worldwide annual turnover. Total revenue in the year to September 2023 stood at $383 billion ($352).

"Apple Pay and Apple Wallet will continue to be available in the EEA for users and developers, and will continue to provide an easy, secure and private way to pay," the company said in a statement.

The EU has increasingly clashed with Apple and other tech titans after introducing new competition rules.

The European Union's executive arm last month said it was launching an investigation into Apple's App Store for alleged anti-competitive practices.

The Digital Markets Act (DMA) is aimed at making sure the companies do not privilege their own services over rivals, but the iPhone maker says this can jeopardize users' privacy.

rc/lo (AP, AFP, Reuters)

(The above story first appeared on LatestLY on Jul 11, 2024 09:40 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).