Apple Denies iPhone Price Fixing Allegations As Russian Antitrust Authorities Open Probe Into Its Practices

Russia's federal antitrust regulator has started a suit against Apple and a few Russian smartphone retailers, on account of alleged price-fixing of iPhones.

The Federal Anti-Monopoly Service (FAS) states that it is running an investigation to discover whether or not Apple and 16 Russian resellers agreed to lock iPhone 6s and iPhone 6s Plus prices beginning in October 2015. The regulator underlines that the prices were stable across the board and over a significant period of time.

According to its website, the FAS considered that such a coincidence could be the outcome of a negotiation between Apple and local resellers.

"Resellers set their own prices for the Apple products they sell in Russia and around the world," the OEM notes.

The helm of FAS's anti-monopoly unit, Andrei Filimonov, previously affirmed that his unit is studying the possibility of iPhone price-fixing. Filimonov noted that the culprits could receive fines in value of 15 percent of iPhone sales revenue.

As the relations between the U.S. and Russia have hit the lowest level since the end of the Cold War, U.S. businesses in Russia were constantly under fire. It did not help that the European Union and the U.S. sanctioned Russia after its annexation of Crimea in March 2014. In retort, Russia embargoed a number of food products from the E.U. and the U.S.

Two years ago, Russia's state consumer regulator temporarily closed down 12 McDonald's restaurants and subjected 100 more to thorough sanitary inspections. In 2015, McDonald's Corp. said that its expansion in Russia will continue.

With Russia's increased focus on restricting human rights, tech companies slowly became a favorite dish at the regulators' table. The Russian government aims to have full control over Russia's mainly unfettered internet, which puts it at odds with tech industry representatives.

In 2014, Russia passed a law that forced foreign internet companies, such as Twitter, Facebook and Google to store Russian users' personal data on servers from within the country. Predictably, Western companies postponed doing so and are pushing back deadlines as much as they can.

Earlier in 2016, Google lost one of its lawsuits with the FAS in a Russian court. According to the verdict, Google had purportedly utilized the massive deployment scale of its Android OS to ensure that vendors embed the company's apps and services on their devices.

In 2015, Russia saw its economy plunge by 3.7 percent, as a direct result of Western sanctions and rapid decrease of the price for crude oil, the country's main export material. Although the crisis reverberated in handset sales, which dropped by 7 percent during 2015, iPhones represented 27 percent of the revenue for smartphone sellers.

Russia's centrally delegated internet ombudsman, Dmitry Marinichev, chastised the regulator for locking horns with the iPhone manufacturer. Marinichev's position makes it easy for him to have a full perspective of the sector, but gives him no enforcement powers. He notes that even though vendors could be disciplined for sealing prices to a certain level, the same cannot be applied to Apple.

"It's a commercial company and therefore it works on the free market and defines for itself what the pricing level should be for a given market," Marinichev says.

ⓒ 2024 TECHTIMES.com All rights reserved. Do not reproduce without permission.
Join the Discussion
Real Time Analytics