$84 million payout could settle Apple antitrust investigation in South Korea

By

South Korea1
An interior photo of Apple's spectacular South Korea store.
Photo: Apple

Apple’s South Korea business has said that it will make a 100 billion won ($84 million) payout to support small businesses and help consumers. This is to address antitrust concerns raised in the country.

Korea’s Fair Trade Commission has been investigating Apple Korea for reportedly forcing mobile carriers to pay for advertising and warranty repairs. The payout — which is phrased like a pledge, but also sounds like a fine — will act as a make-good on Apple’s “unfair” terms.

Apple’s $84 million payout in South Korea

Reuters notes that:

“Out of the 100 billion won, Apple pledged to offer 40 billion won to build a centre to support research and development for Korea’s small manufacturers and 25 billion won to establish an ‘academy’ to provide education to developers. Another 25 billion won 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.”

South Korea’s complaints against Apple go back a few years. As I wrote in 2018, there are two main criticisms of Apple’s behavior. One is that Apple makes telecom companies follow its own guidelines for adverts, but does not share the costs. The second is that Apple Korea reportedly makes telecom operators bear repair costs and display stand installation costs.

Some people have suggested that South Korea sometimes slaps foreign companies with fines for spurious charges. Roger Kay, president of the tech analysis firm Endpoint Technologies Associates, has accused South Korea of having a “protectionist agenda” in the way it does business.

Antitrust issues in

Other countries have accused Apple of making mobile carriers order a certain amount of product and pay for ads to promote them before. Taiwan fined Apple 20 million Taiwanese dollars ($683,068) for this in 2013. In 2016, France also fined Apple 48.5 million euros ($59.39 million) for a similar charge.

Apple’s issues in South Korea may not be over, either. Local startups recently submitted a petition to the Korea Communications Commission. This petition asked them to investigate Apple and Google. This is over concerns about their charging 30% commission on app purchases. Other countries have raised similar concerns.