The European Commission has agreed to accept Apple’s proposal to open up access to the iPhone’s NFC functionality via Host Card Emulation (HCE) — with modifications that will also make it possible for iPhones to support person-to-person and merchant transactions via SoftPOS.

“The European Commission has made commitments offered by Apple legally binding under EU antitrust rules,” the official announcement says. “The commitments address the Commission’s competition concerns relating to Apple’s refusal to grant rivals access to a standard technology used for contactless payments with iPhones in stores (‘Near-Field-Communication (NFC)’ or ‘tap and go’).”

The move follows a proposal of commitments made by Apple to the European Commission in January. This included an offer to provide a new set of APIs that approved developers would be able to use to provide a host card emulation-based alternative to Apple Pay.

The Commission then market tested Apple’s commitments and consulted interested third parties to verify whether the proposal would remove its competition concerns.

“In light of the outcome of this market test,” the Commission says, “Apple amended the initial proposal and committed:

• To extend the possibility to initiate payments with HCE payment apps at other industry-certified terminals, such as merchant phones or devices used as terminal (so called SoftPOS), if this is enabled.
• To explicitly acknowledge that HCE developers are not prevented from combining the HCE payment function with other NFC functionalities or use cases.
• To remove the requirement for developers to have a licence as a Payment Service Provider (‘PSP’) or a binding agreement with a PSP to access the NFC input.
• To allow NFC access for developers to pre-build payment apps for third party mobile wallet providers.
• To update the HCE architecture to comply with evolving industry standards used by Apple Pay, and to continue to update standards even if they are no longer implemented by Apple Pay, under certain conditions.
• To enable developers to prompt users to easily set up their default payment app and redirect users to the default NFC settings page, enabling defaulting with only a few clicks.
• To comply with the same industry standard-specifications as developers of HCE payment apps and to protect confidential information obtained in the context of an audit.
• To shorten deadlines for resolving disputes. Moreover, Apple offered additional independence and procedural guarantees for the monitoring trustee.

“The Commission concluded that Apple’s final commitments would address its competition concerns over Apple’s restriction of third-party mobile wallet developers’ access to NFC payments in stores for EEA iOS users. It therefore decided to make them legally binding on Apple.

“The commitments will remain in force for ten years and apply throughout the EEA. Their implementation will be monitored by a monitoring trustee appointed by Apple who will report to the Commission for the same time period.”

“Apple’s commitments are without prejudice to Apple’s current or future obligations under other regulations, in particular relating to other use cases and functionalities within the scope of the Digital Markets Act (Regulation 2022/1925) and the implementation of the Digital Euro,” the Commission adds.

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