The UK’s Competition and Markets Authority (CMA) is set to publish proposals later this week that call for changes to Apple’s iOS operating system to allow other payment providers access to its tap-to-pay feature, according to the Financial Times.

Citing several people familiar with the matter, the paper reported that the regulator will argue that Apple exercises unfair power over the tap-to-pay market and recommend that iPhones allow users to choose alternatives to the first party Apple Pay.

The recommendation will form part of the CMA’s conduct requirements on the company after its mobile platform was designated as holding strategic market status (SMS) under the UK’s digital competition rules earlier this year.

SMS designation is applied to companies with what the CMA considers outsized influence in digital markets and has the power to compel the companies to follow certain rules. The designations last for five years and fines for breaches can reach up to 10 per cent of annual turnover.

On Friday, the CMA proposed designating Apple’s largest computer operating system rival, Microsoft, in the same category.

The CMA opened an investigation into its payment provision in June after hearing concerns from businesses, according to its website. In the same statement, the regulator said that removing the current restrictions on the software would help “unlock innovation”, allowing support for future payment methods including account to account, digital currency and stablecoins, as well as other non-financial uses such as digital ID and car keys.

People familiar with the matter told the FT that Apple was likely to challenge the decision in court. Apple did not respond to FT request for comment. The CMA declined to comment to the daily.

In 2024, Apple opened up its payment ecosystem to allow other companies to access its NFC technology, but only if they enter into commercial agreements with Apple, including committing to its security and privacy rules and paying “associated fees”.

In the EU, Apple has already been forced to allow other operators to build their own wallets, a system the FT reported the CMA is likely to recommend.

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