Apple loses Taiwan anti-competitive practices court case
17/06/2015 10:15
By Michael Gold
TAIPEI, June 17 (Reuters) - Apple Inc AAPL.O has lost a
lawsuit in which it was accused of engaging in anti-competitive
practices and will be fined T$20 million ($647,124), a Taiwan
court said on Wednesday.
The island's Fair Trade Commission had previously levied the
fine against the Silicon Valley firm for requiring its major
Taiwan telecom partners to receive approval for pricing plans
for its wildly popular iPhone series in advance of public
release, in violation of Taiwanese law.
Apple subsequently countersued and lost the suit.
"Apple limited telecoms from setting contract price for its
4, 4S, 5 and 5S models, which is against the law," commission
spokesman Chiu Yung-ho told Reuters. The court noted that Apple
can still appeal.
When contacted by Reuters, Apple declined to comment on the
matter.
Its iPhones are usually bundled with contracts via one of
Taiwan's three major telecom companies, Chunghwa Telecom Co Ltd
2412.TW , Taiwan Mobile Co Ltd 3045.TW and Far EasTone
Telecommunications Co Ltd 4904.TW .
Taiwan Mobile and Far EasTone also declined comment.
Chunghwa only said it respects the actions of the Fair Trade
Commission, without elaborating.
The case was the first example of a jurisdiction fining the
tech powerhouse for limiting the ability of its telecom partners
to set its own prices, according to the commission.
Telecom companies in Taiwan own the rights to the phones
they sell and can set prices however they see fit, the
commission said.
"When the phone is transferred to a third party telecom, the
vendor loses its right to set prices," said Chiu of the
commission.
In addition to contract prices, Apple also insisted upon
approving the telecoms' iPhone subsidies, price differentials
between old and new phone models and advertising content, the
commission said.
Apple was Taiwan's most popular smartphone vendor as of the
fourth quarter last year, with a 32 percent market share,
according to analysts International Data Corp.
Many Taiwan companies, including Hon Hai Precision Industry
Co Ltd 2317.TW , Pegatron Corp 4938.TW and Taiwan
Semiconductor Manufacturing Co Ltd 2330.TW , make components or
provide assembly services for Apple gadgets, and Apple-related
exports are a major driver of Taiwan's economy.
($1 = 30.9060 Taiwan dollars)
(Editing by Jacqueline Wong)
((michael.gold@thomsonreuters.com; +886225004899; Reuters
Messaging: michael.gold.thomsonreuters.com@reuters.net))
Keywords: TAIWAN APPLE/