1 week Ago By Varun Godinho
Commonwealth Bank chief executive and managing director Matt Comyn has renewed calls for Apple to be subjected to more regulatory scrutiny after its entry into financial services, labelling the technology giants as “free riders”. Comyn called for a bank-style levy on Apple and other large tech companies to level the competition field. At the annual ASIC Forum on Thursday, Comyn argued the competition watchdog should probe the terms Apple has laid down for bank apps’ access to iPhones to make tap-and-go payments, according to the Australian Financial Review.
He contends that while Apple earns some money from the transactions processed, it is not doing enough to support the infrastructure on which it relies. “There are lots of free-riders in industries and cross-subsidies have never been larger,” he said. “Where the weight of the obligation and expectation is felt by a smaller and smaller group of financial institutions where at some point it is unprofitable – but unless some form of economic model [develops] over that period of time, services will degrade in those areas.
“We have to find a balanced solution. It can’t just be the biggest at scale players, while [others] are making a minimal or zero contribution.” “Free-riders at a small scale are not problematic in the same way as free-riders at a large scale – and a number of the tech companies are good examples of that,” he said.
Comyn went on to take a swipe at the tax that companies such as Apple were paying in Australia. “Last time I looked, something like an Apple was probably paying tax in this country of something like 1 per cent of its revenue. It would be low single digit in terms of the tax rate and we pay the full 30 per cent .
.. I think that’s something that would need to be looked at.
” He said it was right big Australian companies were held to clear legal obligations, but these were “unequally applied to some of the international companies”. Comyn didn’t rule out the idea of the federal government imposing a levy on technology groups, similar to the annual charge imposed on banks. Asked if Apple required further regulation in Australia, Comyn replied: “Unequivocally yes.
They facilitate lots of competition as long as no one can ever compete with them.” Comyn claimed that CBA processed almost 5.5 million disputed transactions a year, with about 550,000 of those stemming from Apple, more than double any other source.
In July, Apple voided the threat of fines from EU regulators by agreeing to open up its mobile wallet technology to other providers free of charge for a decade. Consumers in Europe can use alternative digital wallets to pay for goods and services at checkouts. Apple said that it would roll out access to its payments chip in Europe while also allowing contactless transactions for car and home keys, corporate badges, loyalty cards, and event tickets.
In August, Apple said that it would allow Australian banks also to offer payments directly from apps without Apple Pay. However, banks have reportedly been offered commercial terms which Comyn says warrant investigation by the Australian Competition and Consumer Commission (ACCC). He went on to assert that the ACCC asses a proposed regime by Apple to allow third-party contactless payments through Apple phones, outside the tech giant’s own network.
.
