Australia regulator says Apple misleading consumers on iPad

SYDNEY Tue Mar 27, 2012 2:39pm IST

1 of 2. Customers look at the new iPad at the Apple Store in the Eaton Centre shopping mall in Toronto, March 16, 2012.

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SYDNEY (Reuters) - Apple's (AAPL.O) hot-selling new iPad hit a hurdle in Australia on Tuesday as the country's consumer affairs regulator accused the company of misleading promotions.

The Australian Competition and Consumer Commission said it would ask a federal court on Wednesday to order Apple to ensure consumers were made aware of the real technical capabilities of the device, correct its advertising and refund any affected buyers.

Apple's promotions for the iPad with Wifi+4G say buyers can connect to a 4G mobile data network in Australia with a SIM card, but that is not the case, the regulator said in a statement.

An Apple spokeswoman in Sydney could not be reached immediately for comment.

Australia has only one 4G network from dominant telecoms firm Telstra (TLS.AX) but the network is on a different part of the communications spectrum that cannot connect to the iPad.

While the iPad is the clear market leader and the new version with its faster chips, fourth-generation wireless and a sharper display is only expected to cement Apple's lead, it has not been entirely smooth sailing for Apple.

It is waging a legal battle with a Chinese firm over the rights to the iPad trademark in one of the biggest growth markets.

The long-running dispute with Proview - a financially weak technology company that claims to have registered the trademark - is making its way through Chinese courts and has threatened to disrupt iPad sales.

In Australia, a small but a key launch market for Apple products, it lost a bid to ban the sales of Samsung Electronics Co (005930.KS) Galaxy tablet late last year.

That battle is part of bruising global patent war between the two firms which spans about 30 legal cases in 10 countries.

The Australian regulator's move is unlikely to hamper iPad sales in Australia, though it could force to tweak its promotional campaigns.

(Reporting by Narayanan Somasundaram; Editing by Kim Coghill)

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