In February, French competition and fraud watchdog (DGCCRF) threw a $27 million fine to Apple. It had to pay money for slowing down older iPhones. And now, they’re facing their most significant fine ever, $1.23 billion.
Amid the coronavirus outbreak, the French Competition Authority has found Apple guilty again. They accuse Apple of abuse of economic dependence and cartels within distributors.
Apple gets a sanction for $1 billion
The French Competition Authority accuses Apple of implementing three anti-competitive practices in France. Besides, two wholesalers (part of Apple Premium Reseller) Ingram Micro and Tech Data also get a penalty.
“First, Apple and its two wholesalers agreed not to compete and prevent distributors from competing with each other, thereby sterilizing the wholesale market for Apple products. Secondly, so-called Premium distributors could not risk promoting or lowering prices without risk, which led to an alignment of retail prices between Apple’s integrated distributors and independent Premium distributors,” says French Competition Authority’s president Isabella de Silva.
She further adds, “the Authority considered that, in the present case, Apple had committed an abuse of economic dependence on its premium retailers, a practice which the Authority considers to be particularly serious.”
How did Apple Violate the Rules?
According to the Competition Authority, Apple has implemented three anti-competitive practices within its distribution network of electronic products (excluding iPhone).
The practices are “distribution of products and customers between its two wholesalers,” sale prices imposed on premium reseller retailers,” and “abuse of economic dependence on the premium reseller.”
Apart from Apple getting a $1 billion lawsuit, the wholesalers will also pay a hefty amount of money. Ingram Micro gets € 62.9 million, and Tech Data gets € 76.1 million each.
Apple, just this month, agreed to pay $500 million in a settlement as it was accused of throttling older devices. And it’s facing more losses as it shut multiple stores around the world in the wake of the coronavirus.