Australia Regulator to Take More Time on Mobile Wallet Services Decision
August 19 2016 - 3:04AM
Dow Jones News
By Robb M. Stewart
MELBOURNE, Australia--Australia's antitrust regulator will take
more time to decide on whether four Australian banks will be
allowed to collectively negotiate with Apple Inc. (AAPL) and other
providers of mobile wallet services.
In a statement Friday, the Australian Competition and Consumer
Commission denied the banks interim authorization to negotiate
collectively, given the complexity of the issue. It will take time
to consult and consider the views of industry, consumers and other
parties, ACCC Chairman Rod Sims said.
In late July, Commonwealth Bank of Australia Ltd. (CBA.AU),
Westpac Banking Corp. (WBC.AU) National Australia Bank Ltd.
(NAB.AU) and regional lender Bendigo & Adelaide Bank Ltd.
(BEN.AU) applied to jointly negotiate with Apple and other service
providers on conditions relating to competition and transparency.
They have also sought a collective boycott against providers of
consumer "tap-and-go" payment services on mobile phones while talks
are ongoing.
At stake is access by banks and potentially other debit and
credit card providers to iPhones, where they want to offer their
own payment apps alongside the tech company's exclusive Apple Pay.
Being able to negotiate collectively for access would avoid
accusations of breaking competition laws.
Apple argued in a submission to the regulator that the attempt
to form a "cartel" is a tactic by most of the country's dominant
lenders to blunt the company's entry into the market.
It said the move was an attempt to force Apple to accept their
terms, allow them to charge consumers who choose to use Apple Pay
and threatened to undermine the security of its payment system by
opening up access to its so-called near-field communications
antenna, which sends information to payment terminals. Apple also
denied there was any public benefit to allowing a boycott.
The regulator said it plans to make an interim decision on the
application in October. The decision not to allow interim
authorization was no indication of either the draft or final
decisions, he added.
A spokesman for the four banks, which had requested the ability
to negotiate jointly for three years, said the companies would
continue to consult with the regulator until a final determination
is made.
"This application seeks to ensure that Australian customers are
able to choose between different mobile wallets to make payments
easily," he said.
In their submission, the banks said consumers should have a
choice as far as payment technology and would benefit from common
security settings across mobile systems. The application didn't
request the authority to jointly negotiate fees or charges.
A spokeswoman for Apple in Australia said the company had no
comment.
In its application, Apple said the four banks were essential to
its ability to offer Apple Pay "on a meaningful basis within
Australia." It had struggled to negotiate agreements with the local
banks, it said.
Commonwealth Bank, Westpac and National Australia Bank are three
of the country's four biggest banks. The fourth, Australia &
New Zealand Banking Group Ltd. (ANZ.AU), in April signed an
agreement to use the Apple Pay system, which launched in Australia
in November 2015 with American Express.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
August 19, 2016 02:49 ET (06:49 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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