Apple accuses Brazilian banks of seeking ‘free ride’ in NFC investigation

In a recent statement to Brazil’s competition watchdogs, Apple leans into an increasingly common argument as it backs pressure to continue opening up the iPhone’s NFC access. Here are the details.

Apple backs off Brazil’s NFC push

Last year, the Brazilian central bank (Banco Central) and the bank representative group Febraban asked CADE, the country’s competition watchdog, to investigate whether Apple was unfairly restricting third-party payment providers’ access to the iPhone’s NFC compared to its own services.

In response, Apple sent CADE a list of counter-arguments, including that it controls only 10% of the Brazilian smartphone market, and that third-party developers have access to the iPhone’s NFC from 2024.

Apple also said that the Brazilian market is well served by payment options, that Apple Pay “does not cause harm to the consumer, or exclusion of competitors,” and that “there is nothing in Brazilian law that prevents Apple from charging for its services,” as Tecnoblog report at that time.

Apple’s “good use of payment options” refers to PIX, a local, free payment system that, introduced in 2020, is the most widely used payment method in the country.

Last year, Banco Central introduced the PIX protocol, which Apple (as opposed to Google) refused to use, considering it an irrelevant feature for Brazilians, who still rely more on PIX payments with QR codes than new contactless methods.

A few days ago, Apple sent CADE another statement, reaffirming its position.

As reported by O Globothe company’s legal team argued that “there is a desire for third parties – especially banks and payment service providers – to act as ‘free riders’ on Apple’s proprietary technology, without compensating Apple for its related investments in research and development and ongoing services – such as supplier audits, due diligence, and continuous monitoring of security infrastructure.”

In addition, they say:

“(…) these companies are interested in promoting the NFC access model, unlike Apple Pay and Apple Wallet, which presents a conflict that can reduce the willingness of users to easily switch between different payment cards, requiring them to choose a new payment solution every time they want to use a different card.

Apple’s statement came about one month after some company representatives met with Banco Central’s regulatory director, Gilneu Francisco Astolfi Vivan.

The meeting was closed to the media, and no details were disclosed except that it would address “regulatory matters,” according to Vivan’s official January 15 announcement.

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