Apple has been accused of manipulating the retail price of iPhones in Russia for several years. But, it was only last year that Russia had launched an investigation into the Cupertino giant’s activities in the country. And now, it has found Apple guilty of price-fixing the sale of iPhone devices, even though it had previously denied and pushed the blame upon local retailers
When the charges against Apple were brought to light, the company denied any involvement and said that retailers were setting higher prices for products at their own will. But, Russian antitrust regulator, Federal Antimonopoly Service has found that Apple’s subsidiary was responsible for coordinating the prices at which local business could sell the iPhones.
The regulator has further found evidence that the Cupertino giant was illegally ordering retailers to alter the price of the iPhone 5 and 6 models in Russia. Apple was instructing about 16 retailers to regulate the price of their phones and sell them at a certain amount. And if the said retailer was found to be selling the same at a lower or “unsuitable” price, then they would receive an email from Apple telling them to change the price or risk the termination of their agreement.
The complete translated statement from Russia’s FAS is as under:
The investigation revealed that since the start of official sales in Russia of the Apple iPhone 5s, iPhone 5c, iPhone 6, iPhone 6 Plus, iPhone 6s and iPhone 6s Plus, most resellers installed the same prices on them as recommended by Apple Rus and supported them for about 3 months.
At the same time, Apple Rus monitored retail prices for Apple iPhone smartphones installed by resellers in online stores and retail outlets, and, in case of setting “unsuitable” prices, the Russian subsidiary Apple sent emails to resellers with a request to change them. Also, compliance with recommended retail prices by resellers could be due to the provisions of contracts between Apple Rus and resellers.
Further, as per Financial Times, Apple has been given three months to contest the aforementioned decision, which as you can see has not fallen in their favor. There is, however, no information on whether the Cupertino giant will be contesting this decision. But, it has now altered its practices with a policy that should prevent similar situations in the future. Also, an Apple spokesperson has said that it has worked closely with the FAS to finally put the matter behind them.
The anti-trust regulator also hasn’t yet defined penalty charges against Apple, but it could amount to as much as 15 percent of its total sales in Russia. But, this will be finalized in the official release in the coming months. Google has been fined 438 million ruble (approx $7.4 million) for similar practices in the country.
Speaking on their decision, Andrey Tsarikovsky, State Secretary – Deputy Head of FAS Russia said,
In the course of the proceedings, the Russian subsidiary of Apple actively cooperated with the FAS Russia. The Company has adopted the necessary measures to eliminate violations of the law and pursuing a policy to prevent similar violations in the future: the company developed a detailed antitrust compliance, organized training of employees of the Russian antimonopoly legislation norms.
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