After France, Apple accused of unfair contracts with carriers in South Korea


Reuters reports that South Korea’s Fair Trade Commission (FTC) is investigating Apple for possible anti-competitive practices in the country. This appears to support an earlier unconfirmed report in Korea Times that FTC was examining the legality of Apple’s contract terms with mobile carriers.

Sources said Apple Korea has pressed carriers into buying a minimum volume of promotional iPhones and sharing the burden of repair costs […]

In April, the FTC ordered the rectification of 20 unfair provisions in contracts with its certified repair service partners. The contracts included stipulations that the repair firms could not file lawsuits against Apple Korea within a year after any dispute.

If this sounds familiar, it’s because it echoes an earlier case in France …

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In the French case back in April, the Directorate General for Competition, Consumer Affairs and Fraud Control (DGCCRF) argued that ten separate clauses in Apple’s contracts with carriers were unfair, including minimum purchase requirements over a three-year period, and carriers contributing to repair costs.

The DGCCRF said then that Apple should have to pay €48.5M ($54M), comprising compensation to four different carriers and a fine of €8M. A separate case in Taiwan in 2013 resulted in Apple being fined the interestingly precise amount of $666k for ‘interfering with iPhone pricing.’

Details in the Korea case are sparse, Reuters reporting only that the FTC is investigating “some matters” relating to Apple, and Korea Times having no more detailed information than the above quote, attributed to multiple unnamed sources. The paper does note, however, that Apple does not allow carriers to offer subsidized pricing.

Apple does not have any of its own retail stores in Korea, where local brands Samsung and LG dominate, but sells through carriers and third-party resellers. SKT (photo) has the largest share of the market.

Photo: citrusdesign

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Avatar for Ben Lovejoy Ben Lovejoy

Ben Lovejoy is a British technology writer and EU Editor for 9to5Mac. He’s known for his op-eds and diary pieces, exploring his experience of Apple products over time, for a more rounded review. He also writes fiction, with two technothriller novels, a couple of SF shorts and a rom-com!

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