Westpac, NAB and CBA CEOs says Apple’s digital wallet prevents competition and there should be more scrutiny

The comments provided backing for Mr Comyn, who could not hide his pleasure at the antitrust lawsuit filed by the United States against Apple last week, alleging it has abused its market power in the smartphone market to extract higher fees, thwart innovation, and curtail competition, including in the market for digital wallets which are also being developed by banks.

“Of all the things in life, there are a few that I’ve savoured more than reading the 80 pages of United States of America versus Apple Inc,” Mr Comyn said.

He revealed Apple had written to Australian lawmakers in 2021, alleging he had made misleading comments to a parliamentary committee about its dominance of payments.

“The sort of sanctimonious drivel in that letter is laid bare in the 80 pages from the [Department of Justice], where it goes into a pattern of conduct that sort of thwarts innovation, degrades customer experience, breaches customers security and privacy, and harvests their data,” he said.

Apple currently operates outside payments regulation, but a bill in the federal parliament proposes giving the Reserve Bank new power to regulate it alongside other global payments platforms.

The RBA’s head of payments, Ellis Connolly, said the central bank would issue a consultation on potential interventions as soon as the law passed. “There are a few focus areas that are already emerging: one of those is mobile wallets,” he said. “We can see that some efficiency and competitiveness issues are arising, particularly around the access to the underlying technology for competing digital wallet providers.”

Mr King also backed Mr Comyn, saying it was “unfair” that Apple paid little tax in Australia. “They don’t generally pay a lot of tax domestically. From the Australian perspective, they generate a lot of value out of the country, but they don’t contribute back into the tax base of the economy,” he said.

Mr Comyn suggested the government could levy new taxes on big tech companies transferring profits out of Australia to offshore subsidiaries, modelled on the bank levy imposed on the major banks.

Australian Competition and Consumer Commission chairwoman Gina Cass-Gottlieb said the regulator was still investigating Apple Pay, saying she agreed with Mr Comyn the latest US case was “compelling reading”.

She called on the government to adopt new laws to create “detailed codes, [and] one of the early codes would relate to app payment systems and the restrictions that exist, so we could bring [a case] in a coherent way.”

The US action against Apple has been taken under that country’s Sherman Act, which was created in 1890 as a response to the power of Standard Oil. “This is classic antitrust legislation that was specifically designed to deal with gatekeepers of that time,” Mr Comyn said.

“I do think this is a line-in-the-sand moment. I do think the government fully understands what’s at stake … I think we’ve got people who are very focused on what I think is an extremely important topic for lots of industries.”