Apple has been center of a number of controversies in the last couple of years. According to a recent report, the Fair Trade Commission (FTC) of South Korea has accused the company of taking advantage of telecom carriers in the country. According to the report, the company seems to be passing on the cost of iPhone devices to telecom carriers. After a closed hearing, the FTC investigators added that the company was collecting money from the carriers while shifting costs associated with repairs and launch events on telecom operators. Apple defended its practices adding that the practice of collecting money for advertising funds helps both the smartphone maker as well as the carriers.
According to a report by AppleInsider, this information was initially reported by The Korea Herald. According to the report, investigators added that Apple can’t justify its involvement in advertising activities as a branding strategy. According to the report, the FTC allegations against Apple are not really new and date back to 2016. As part of the allegations and associated investigation, the watchdog has made multiple raids at Apple offices. The report noted that a third hearing has been scheduled for February 20, 2019, which may result in a ruling.
Watch: Apple iPhone XS, XS Max Hands-On
In case the company loses the case then it will face a fine “of up to 2 percent” of what the company made from any “connected sales”. Connected sale here refers to the sales resulting from the advertising in the country. The report also noted that the smartphone maker and technology giant is known for imposing “tough terms” including minimum purchase quota and “moratorium against repair firms” that plan on suing Apple for a year after any dispute.
The report also noted that Apple has faced similar cases in other countries. As a result, the consumer watchdogs from countries including Taiwan, France, and Russia has issued fines to the country. The amount of fines imposed on the company regarding its antitrust practices ranges from $670,000 to about $55 million.