[SYDNEY] Australia's competition regulator said it is minded to refuse permission for a coalition of local banks to negotiate collectively with Apple Inc over the introduction of the technology firm's Apple Pay mobile wallet.
Commonwealth Bank of Australia, National Bank of Australia Ltd, Westpac Banking Corp and Bendigo & Adelaide Bank Ltd had applied to the Australian Competition and Consumer Commission for the right to negotiate as a bloc with the iPhone maker, citing a "significant disparity in bargaining power".
The regulator on Tuesday issued a draft determination in which it proposed to deny the lenders' application.
"While the ACCC accepts that the opportunity for the banks to collectively negotiate and boycott would place them in a better bargaining position with Apple, the benefits are currently uncertain and may be limited," Rod Sims, chairman of the Australian Competition & Consumer Commission said in a statement.
Apple's technology bars any app apart from its own from using the functionality of the iPhone's near-field communications antenna, the technology which makes payments on contactless readers possible. It wants banks to upload customers' payment cards into its proprietary digital wallet.
The banks argue that this hampers competition and reduces both choice and access for consumers.
"As this is the draft determination there is opportunity for further submission and further discussions with the ACCC," said Lance Blockley, a senior adviser with financial advisory firm Novanta who is acting as a spokesman for the applicant banks. "We hope to prevail."
The ACCC said it was concerned that allowing the banks to negotiate collectively "could reduce competition between the banks in the supply of mobile payment services for iPhones."
The ACCC's final decision is expected in March 2017.