Big technology companies have grown too big to regulate warn banking leaders

Big technology companies have grown too big to regulate, banking leaders have warned, as they called for a level regulatory playing field between new and traditional industries.

Westpac chief executive officer Peter King said on Tuesday technology companies such as Apple were comparatively less regulated while paying little tax to Australian authorities.

Mr King said emerging technologies such as artificial intelligence were coming into Australia from overseas, which made it to difficult for policymakers to regulate domestically.

“I think they are (getting off too lightly) in a number of ways,” Mr King told the AFR banking summit.

“If we look at the big tech companies, their scale is unbelievable.

“They don’t generally pay a lot of tax domestically from an Australian perspective.

“They generate a lot of value out of a country but they don’t contribute back to the tax base of the economy and they’re not regulated.”

Mr King pointed to the comparatively high cost of payments on Apple’s digital wallet, which allows users to pay with their phones, while the Reserve Bank of Australia had successively imposed regulations to lower the cost of traditional payments.

“It is important we have a level playing field,” he said.

Likewise National Australia Bank CEO Ross McEwan said big tech should play by the same rules as traditional industry and said he was frustrated by the regulatory double standard imposed on tech products like digital payments or Buy Now Pay Later platforms such as Afterpay, which he said performed the same function as credit lending.

“One of the frustrations I feel is if it looks and feels like a payment - it’s a payment,” he said.

“If it looks and feels like a credit, it’s a credit. Something that looks like a payday loan credit and something that looks like Afterpay is a credit.”

Last week the US Justice department filed a civil antitrust lawsuit against Apple for the monopolisation or attempted monopolisation of smartphone markets in the US District Court for New Jersey.

The complaint alleges that Apple has illegally maintained a monopoly over smartphones by selectively imposing contractural restrictions on and withholding critical access points from developers.

Commonwealth Bank chief executive Matt Comyn, an outspoken critic of Apple who has previously drawn the tech giant’s ire, said on Tuesday he savoured the 80 pages of the complaint.

“The challenge for governments and regulators are are these companies too big to regulate,” he said.

“Many of these companies have a GDP in excess of many economies with huge user and customer bases.”

in 2021 Apple accused Mr Comyn of making misleading and false statements about the tech giant to a parliamentary inquiry examining movile payments and digital wallets.

Mr Comyn on Tuesday said the “sanctimonious drivel” of Apple’s complaint was laid bare in the DOJ’s complaint against the tech company and said the case was a “line in the sand moment”.

“I do think the government fully understands what’s at stake,” he said.