It wasn't a Merry Christmas for Apple as the Fair Trade Commission (FTC) of Taiwan slapped the company a T$20 million ($666,700) fine, Wednesday, for violating the country's Fair Trade Act. The iPhone maker was found to have interfered with the pricing of its popular handset for distribution by local wireless service providers.
The antitrust body disclosed that Apple Asia required Taiwan Mobile, Chungwa Telecom, and Far Eastone Telecommunications to submit pricing plans for its approval and even pushed for changes in the pricing schemes of the said companies.
Apple can appeal the ruling but needs to immediately comply with the ruling of the Fair Trade Commission of Taiwan and stop trying to control the prices of iPhone or face additional fines of roughly $1.67 million. Apple Asia has not commented about the matter.
"Through the email correspondence between Apple and these three telecom companies we discovered the companies submit their pricing plans to Apple to be approved or confirmed before the products hit the market," said FTC in a statement.
Taiwan FTC's decision was in reference to Article 18 of the country's Fair Trade Act of 2011 that reads, "Where an enterprise supplies goods to its trading counterpart for resale to a third party or such third party makes further resale, the trading counterpart and the third party shall be allowed to decide their esale prices freely; any agreement contrary to this provision shall be void."
According to the commission, the carriers should have the freedom to structure their pricing after acquiring distribution rights from Apple.
The commission ruled on the case of distribution of the iPhone and has no plans of investigating price interference with regard to Apple iPads.
The Taiwanese watchdog has been strict on violations against the Fair Trade Act. In its newsletter, it disclosed that it has handled 5,818 cases involving violations to the said law. About 70.5 percent of these cases involved unfair competition practices, 16.2 percent was about imposition of competition restrictions, and 12.1 percent was due to inappropriate multilevel sales practices.
