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Sunday 20.08.2017 | Name days: Bernhards, Boriss

Brussels probes Apple’s iPhone tactics

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Author: REUTERS/SCANPIX

Brussels is investigating whether Apple is muscling out rival smartphone makers from the European market with anti-competitive iPhone sales tactics and technical restrictions on the handset.

The scrutiny adds to the pressure Apple is facing from government regulators, coming in the week that US senators questioned Apple chief executive Tim Cook for the technology company’s tax accounting practices.

According to a questionnaire sent last week to several EU mobile network operators, the European Commission’s probe is focusing on distribution terms that might favour Apple by ensuring no rival can secure a better sales deal, according to Financial Times.

The inquiry is spurred by private complaints from mobile operators and remains at a preliminary stage. Before launching a formal abuse probe, the commission will need to be confident that Apple is dominant in the EU smartphone market, a bar that may prove hard to clear given the emergence of Samsung’s popular Galaxy handsets. Apple says its contracts fully comply with EU laws.

The nine-page questionnaire sent to telecoms groups primarily relates to sales practices, including whether Apple forces groups to buy a minimum number of iPhones, restrictions on the use of marketing budgets, and clauses that ensure Apple is always offered no worse subsidies and sales terms than other smartphone makers.

It also asks whether Apple places technical or contractual restrictions on the iPhone 5 that mean it cannot be used on high-speed 4G networks in Europe.

“The Commission has information indicating that Apple and Mobile Network Operators (“MNOs”) have concluded distribution agreements which may potentially lead to the foreclosure of other smartphone manufacturers from the markets,” the questionnaire states.

“There are also indications that certain technical functions are disabled on certain Apple products in certain countries in the EU/EEA. If the existence of such behaviour were to be confirmed, it might constitute an infringement of [antitrust law]”.

Apple’s uncompromising sales tactics have long been a sore issue for telecoms groups. Some executives have recently raised their specific concerns with the commission, including Apple’s tight control over sales and marketing plans for its devices, especially when new products are launched.

The mobile operators are given until June 17 to reply.

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