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France slaps Apple with $1.2b fine

China Daily | Updated: 2020-03-18 09:53

Staff stand in an Apple store with no customers after it was closed on Regents Street in London, Britain, March 14, 2020. [Photo/Agencies]

PARIS-France's competition watchdog on Monday fined iPhone maker Apple 1.1 billion euros ($1.2 billion), saying it was guilty of anticompetitive behavior toward its distribution and retail network.

The fine, the biggest yet levied by the French antitrust body, comes at a time of heightened scrutiny on US technology giants by European regulators, which have been delving into the firms' powerful market position, the tax they pay, and how they protect consumers' privacy.

Apple said it would appeal the watchdog's ruling, which it said was at odds with legal precedent in France.

In its decision, the French regulator said Apple imposed prices on retail premium resellers that were aligned with those charged by the California firm in its own shops, or on the internet.

The watchdog said Apple's two wholesalers in France fully followed the US company's instructions on how to allocate its products to customers, instead of freely determining their commercial policy.

"Apple and its two wholesalers agreed not to compete with each other and to prevent distributors from competing with each other, thereby sterilizing the wholesale market for Apple products," the watchdog said in a statement.

The case began in 2012 when one of Apple's independent premium resellers complained about uncompetitive practices that included squeezing supplies in favor of its own stores.

The two wholesalers, Tech Data and Ingram Micro, were fined 76 million and 63 million euros respectively, the authority said. Tech Data had no immediate comment and Ingram Micro could not immediately be reached.

Three breached areas

The authority found three areas of anti-competitive behavior.

The first was that Apple and its wholesalers agreed not to compete against one another.

Second, independent retailers "could not without risk undertake promotions or lower prices, which led to an alignment of retail prices", said Isabelle de Silva, head of the competition authority.

"Finally, Apple abusively exploited the economic dependence of these premium resellers on it and imposed unfair economic conditions on them that were worse than those for its integrated network of retailers," she added.

Apple said in a statement that it planned to appeal.

"The French competition authority's decision is disheartening." it said. "It relates to practices from over a decade ago and discards 30 years of legal precedent that all companies in France rely on with an order that will cause chaos for companies across all industries."

Since her nomination as the head of the French competition authority in 2016, de Silva has set her sights on US tech companies, including Alphabet's Google, which was fined 150 million euros for opaque advertising rules.

Agencies - Xinhua

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