EU Questions Cell Carriers Over Apple’s Sales Practices

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The European Commission has begun asking cell service providers pointed questions about Apple's sales practices. The questions hint that a formal investigation against Apple into anticompetitive practices over the iPhone may be coming.

European Union looks into potential anti-competitive practices from AppleEuropean Union looks into potential anti-competitive practices from Apple

EU cell companies are being asked questions about whether or not they're required to buy a at least a certain number of iPhones, if the deals require Apple to be given subsides that are at least as good as other phone makers, and if Apple gets a say in carrier marketing budgets, according to the Financial Times. The nine-page document also asks if Apple is restricting carriers so the iPhone can't be used on Europe's high speed 4G networks.

The questionnaire also makes several clear-cut statements as to its intent, such as,

The Commission has information indicating that Apple and Mobile Network Operators ('MNOs') have concluded distribution agreements which may potentially lead to the foreclosure of other smartphone manufacturers from the markets," the questionnaire states.

There are also indications that certain technical functions are disabled on certain Apple products in certain countries in the EU/EEA. If the existence of such behaviour were to be confirmed, it might constitute an infringement of [antitrust law].

The European Commission's questions follow a U.S. Senate hearing where Apple was questioned on its tax payment practices along with corporate tax sheltering practices in general. Apple CEO Tim Cook said during the hearing that his company fully complies with U.S. tax laws and that if politicians feel it should pay more, then the laws need to be changed.

"We pay all the taxes we owe – every single dollar. We not only comply with the laws, but we comply with the spirit of the laws. We don't depend on tax gimmicks," Mr. Cook said. "We don't move intellectual property offshore and use it to sell products back into the U.S. to avoid U.S. taxes."

The EU questions came in response to complaints from cell service providers. Before a full investigation can be launched, however, the Commission will also need to show that Apple is the biggest player in the market and Samsung's growth make make that difficult to do.

Companies that received the questionnaire have until June 17 to reply. Apple has not commented on the questioning.

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