BEN Bendigo And Adelaide Bank Limited

   By Robb M. Stewart 
 

MELBOURNE, Australia--Australia's antitrust regulator will take more time to decide on whether four Australian banks will be allowed to collectively negotiate with Apple Inc. (AAPL) and other providers of mobile wallet services.

In a statement Friday, the Australian Competition and Consumer Commission denied the banks interim authorization to negotiate collectively, given the complexity of the issue. It will take time to consult and consider the views of industry, consumers and other parties, ACCC Chairman Rod Sims said.

In late July, Commonwealth Bank of Australia Ltd. (CBA.AU), Westpac Banking Corp. (WBC.AU) National Australia Bank Ltd. (NAB.AU) and regional lender Bendigo & Adelaide Bank Ltd. (BEN.AU) applied to jointly negotiate with Apple and other service providers on conditions relating to competition and transparency. They have also sought a collective boycott against providers of consumer "tap-and-go" payment services on mobile phones while talks are ongoing.

At stake is access by banks and potentially other debit and credit card providers to iPhones, where they want to offer their own payment apps alongside the tech company's exclusive Apple Pay. Being able to negotiate collectively for access would avoid accusations of breaking competition laws.

Apple argued in a submission to the regulator that the attempt to form a "cartel" is a tactic by most of the country's dominant lenders to blunt the company's entry into the market.

It said the move was an attempt to force Apple to accept their terms, allow them to charge consumers who choose to use Apple Pay and threatened to undermine the security of its payment system by opening up access to its so-called near-field communications antenna, which sends information to payment terminals. Apple also denied there was any public benefit to allowing a boycott.

The regulator said it plans to make an interim decision on the application in October. The decision not to allow interim authorization was no indication of either the draft or final decisions, he added.

A spokesman for the four banks, which had requested the ability to negotiate jointly for three years, said the companies would continue to consult with the regulator until a final determination is made.

"This application seeks to ensure that Australian customers are able to choose between different mobile wallets to make payments easily," he said.

In their submission, the banks said consumers should have a choice as far as payment technology and would benefit from common security settings across mobile systems. The application didn't request the authority to jointly negotiate fees or charges.

A spokeswoman for Apple in Australia said the company had no comment.

In its application, Apple said the four banks were essential to its ability to offer Apple Pay "on a meaningful basis within Australia." It had struggled to negotiate agreements with the local banks, it said.

Commonwealth Bank, Westpac and National Australia Bank are three of the country's four biggest banks. The fourth, Australia & New Zealand Banking Group Ltd. (ANZ.AU), in April signed an agreement to use the Apple Pay system, which launched in Australia in November 2015 with American Express.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

August 19, 2016 02:49 ET (06:49 GMT)

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