Apple Korea, Under Antitrust Probe, Proposes $84 Million to Support Small Businesses

Apple Korea has been under investigation for allegedly forcing mobile carriers to pay for advertising and warranty repairs.

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Apple Korea, Under Antitrust Probe, Proposes $84 Million to Support Small Businesses

Photo Credit: Reuters

Apple held an 18 percent share in South Korea's mobile phone market

Highlights
  • Apple Korea has been under investigation by the Korea FTC
  • Apple has agreed to fix 'unfair' terms with mobile carriers
  • Apple held an 18 percent share in South Korea's mobile phone market

Apple's South Korean unit has proposed measures to address antitrust concerns and offered to provide KRW 100 billion, or $84.02 billion (roughly Rs. 629 crores) worth of support programmes for small businesses, consumers and others, the country's competition watchdog said on Monday.

Apple Korea has been under investigation by the Korea Fair Trade Commission (KFTC) over allegations it abused its dominant position by forcing mobile carriers to pay for advertising and warranty repairs, the commission has said.

Apple has agreed to fix 'unfair' terms with mobile carriers as part of its proposal, the KFTC said in a briefing. For example, Apple will discuss how to share advertising costs with telecom firms, which will help reduce burdens to carriers, the KFTC said.

Apple Korea was not immediately available for comment.

Out of the KRW 100 billion, Apple pledged to offer KRW 40 billion (roughly Rs. 251.59 crores) to build a centre to support research and development for Korea's small manufacturers and KRW 25 billion (roughly Rs. 157.24 crores) to establish an 'academy' to provide education to developers. Another KRW 25 billion will be used to give consumer discounts on warranty repair costs and other benefits.

The regulator will close the case without concluding whether Apple did anything illegal if it finds the proposed remedies reasonable after collecting public opinion.

In 2019, Apple held an 18 percent share in South Korea's mobile phone market, the home turf of Samsung Electronics, which controlled 65 percent of the market, according to data from researcher Counterpoint.

Apple faces antitrust pressure in other countries. In March, French regulators fined Apple EUR 1.1 billion (roughly Rs. 9,713 crores), saying the iPhone maker was guilty of anti-competitive behaviour toward its distribution and retail network. Apple said at that time that it would appeal to the decision.

© Thomson Reuters 2020


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