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Australian regulator denies interim authorisation of banks’ contest with Apple

Hafizah Osman | Aug. 22, 2016
The banks and card issuers are seeking authorization to collectively negotiate on various issues

Industry body, the Australian Competition and Consumer Commission (ACCC), is assessing the applications for authorisation by Aussie banks after deciding not to grant their request for interim authorisation.

The banks involved in this dispute include Commonwealth Bank of Australia, Westpac Banking Corporation, National Australia Bank, and Bendigo and Adelaide Bank, which all wish to engage in collective negotiation and boycott activities with Apple in relation to its Apple Pay platform and with other third party wallet providers in Australia.

The banks, together with other participating card issuers, are seeking authorisation to collectively negotiate and boycott on a range of issues.

One of these issues is their ability to utilise Near Field Communication hardware on Apple devices to enable contactless payments to be made through the banks’ own digital wallets.

This ongoing row follows the banks’ seeking of authorisation on behalf of themselves and potentially other credit and debit card issuers on July 26, to engage in limited collective negotiation with Apple and other third-party mobile wallet service providers.

The banks also sought authorisation to enter into a limited form of collective boycott in relation to a third-party mobile wallet provider while collective negotiations with that provider are ongoing.

ACCC chairman, Rod Sims, said it decided not to grant interim authorisation at this time given the complexity of the issues and the limited time available.

“The ACCC requires more time to consult and consider the views of industry, consumers, and other interested parties,” he said.

According to Sims, the ACCC took into account the potential for continuing effects on competition in the market, the extent of urgency for the request, any possible harm to the applicants or other parties if interim authorisation is granted or denied, and possible public benefits and detriments when determining its decision.

“The entire ACCC authorisation process usually takes up to six months, including the release of a draft decision for consultation before making a final decision.

“We expect to release a draft decision in October 2016. The ACCC’s decision not to grant interim authorisation at this time is not indicative of whether or not a draft or final authorisation will be granted,” Sims added.


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