Taiwan's Fair Trade Commission fines Apple for price restrictions

TAIPEI Thu Dec 26, 2013 9:36am IST

The Apple logo is seen against the reflection of Taiwan's landmark building Taipei 101, August 25, 2011. REUTERS/Pichi Chuang/Files

The Apple logo is seen against the reflection of Taiwan's landmark building Taipei 101, August 25, 2011.

Credit: Reuters/Pichi Chuang/Files

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TAIPEI (Reuters) - Taiwan's Fair Trade Commission (FTC) fined Apple Inc (AAPL.O) $666,700 for restricting the prices charged by local telecom carriers for their iPhone contracts, the first time Apple has been fined for such practices.

The regulator said that Apple Asia, a unit of the Cupertino-based company, required carriers to obtain its permission before setting contract prices on iPhones in violation of Taiwan's free-trade laws.

Apple Asia also told carriers to alter service contract prices and subsidy prices, according to an FTC statement on Wednesday, leading to the fine of T$20 million.

Officials with Apple Asia could not be reached for comment on Thursday.

The three carriers, Chunghwa Telecom Co Ltd (2412.TW), Taiwan Mobile Co Ltd (3045.TW) and Far EasTone Telecommunications Co Ltd (4904.TW), had all obtained reseller rights under their contracts with Apple, which gave them the right to set prices, FTC spokesman Sun Lih-chyun said.

Apple has been facing challenges in the rapidly-evolving marketplace for the smartphones in which it once held a commanding lead.

The company recently reported that it signed a long-awaited deal with China Mobile Ltd (0941.HK) (CHL.N), China's largest telecom carrier, to sell its iPhones, raising hopes that it may make significant inroads in the world's largest smartphone market.

(Reporting by Michael Gold and Clare Jim; Editing by Matt Driskill)

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