Fair Trade Commission To Deliberate On Apple’s Alleged Ad Cost Dumping

Apple's First Store in South Korea
Apple's First Store in South Korea

Chairman Cho Sung-Wook of the Fair Trade Commission, along with her commissioners, are planning to deliberate on the validity of Apple Korea’s pledge to remedy the company’s supposed ad cost dumping on mobile carriers.

The meeting which is set on September 25 will also include a decision on whether or not FTC will continue its investigation on Apple’s abuse of its marketing advantage in controlling South Korean mobile carriers.

“Apple Korea’s filing of a consent decree will be discussed at the meeting, but we cannot guarantee whether a decision will be made or if there will be additional meetings. There is no rule on how many meetings will take place,” FTC representatives said. “If the consent decree request is accepted, however, the case will be closed without making a determination of whether the company’s practices are illegal. Otherwise, the case will be proceeded with as a standard one.”

The issue is rooted in allegations that Apple unjustly collected advertising funds from mobile carriers. These mobile carriers included SK Telecom, KT, and more. Three meetings have been held regarding the matter since December, but a decision is yet to be made.

Apple Korea submitted a consent decree in June signifying that it accepts partial responsibility of the allegation. Proclaiming such decree means that a company will likewise cease to perform the said questionable acts. FTC, however, is yet to provide further details contained in the decree.

If the commission were to accept the decree, no further punishment would be carried out on the company. The latter will, however, need to perform corrective measures to prevent the reoccurrence of the problem.

“If the FTC rejects the filing, it can become another global precedent finding the U.S. tech giant’s business practice as unfair, since Apple uses similar policies of passing on iPhone marketing costs in other countries,” said a representative from a local telecom company.

“If the FTC accepts Apple’s consent decree, on the other hand, it means the Korean competition authority will not question the practice, providing grounds for Apple to maintain the policy in other markets.” he continued.

Apple’s chances of getting their decree approved seam bleak. FTC has dismissed several similar decrees since December 2016 from large companies such as Qualcomm, LS Group, Hyundai Mobis, and Golfzon.

Featured image grabbed from Apple’s website.

About KoreaTechToday Editor

KOREATECH TODAY, A NEWS PLATFORM FOR KOREAN TECH WITH A FOCUS ON INDUSTRY NEWS AND PROMISING PROJECTS.

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