Apple abuse of dominance through non-supply of spare parts (FAS revealed elements of “Apple Rus” Ltd. breaching the Law on Protection of Competition in failure to ensure use of goods within their lifecycle)

05.09.2017 | 16:33

Case

FAS Russia ruling on postponing consideration of the case on supply of spareparts of February 20, 2017 No АК/11838/17 and of May 3, 2017 No АК/30808/17 (Russian versions only).

Parties

Apple Rus Ltd.

Jurisdiction

Federal Antimonopoly Service

Type

Abuse of dominance

On December 7, 2016 the FAS Russia opened a case and formed the Commission to investigate a case in relation to Apple Rus Ltd. upon signs of abusing dominance by the company[1].The FAS revealed elements of “Apple Rus” Ltd. breaching Part 1 Article 10 of the Federal Law “On Protection of Competition” in failure to ensure use of goods within their lifecycle, i.e., absence of supplies of components (screen modules and bother boards) required for repair to the Russian Federation, as a result of which the interests of consumers at large were infringed.

According to a complaint received by the FAS Russia, in 2016 service centers refused to replace a damaged display on a customer’s Apple iPhone 6 Plus smartphone because of the fact that these spare parts are not supplied to Russia and offered the smartphone owner to replace the old smartphone with a new one in exchange for a fee[2].

The FAS Russia established that actions of the Apple Rus Ltd., which is the only supplier of Apple products in Russia, contain signs of violating Part 1 Article 10 of the Federal Law “On Protection of Competition”, i.e. failure to support the usage of Apple iPhones during their exploitation term[3]. The company did not supply components required for repair (screen modules and mother boards) to the Russian Federation, and as a result infringes the interests of consumers[4].

Company representatives asked to consider the case against Apple Rus Ltd. concerning signs of violating the antimonopoly law under Clause 5 Part 1 Article 10 of the Federal Law “On Protection of Competition”, which envisages issuing warnings to eliminate signs of violating the competition law[5].

The FAS Russia agreed with the proposal of Apple Rus Ltd. and additionally qualified the case under the above-mentioned clause with issuing a relevant warning to be executed by May 1, 2017 and postponing the consideration of the case under 5 Part 1 Article 10 later in 2017[6].

In June 2017, the FAS Russia after the verification confirmed that the company has complied with the warning by providing services for repairing/replacing screen modules on Apple smartphone models sold in Russia, which is twice as cheap as replacing an old phone with the new one[7].

 



[1] See “FAS opened a case against “Apple Rus” Ltd.”, FAS Russia press release of December 14, 2016 http://en.fas.gov.ru/press-center/news/detail.html?id=48203

[2] See “Andrey Kashevarov: the case against “Apple Rus” Ltd. will be considered on 17 January 2017”, FAS Russia press release of December 23, 2016 http://en.fas.gov.ru/press-center/news/detail.html?id=48363

[3] FAS Russia’s Ruling on postponing consideration of the case No АК/30808/17 (Russian version only) http://solutions.fas.gov.ru/ca/upravlenie-kontrolya-sotsialnoy-sfery-i-torgovli/ak-30808-17

[4] FAS Russia’s Ruling of December 21, 2017 No АК/88978/16 on consideration of the case No 1-10-180/00-18-16 (Russian version only) http://solutions.fas.gov.ru/ca/upravlenie-kontrolya-sotsialnoy-sfery-i-torgovli/ak-88978-16

[5] See “FAS issued a warning to “Apple Rus” Ltd.”, FAS Russia press release of February 22, 2017 http://en.fas.gov.ru/press-center/news/detail.html?id=49034

[6] FAS Russia’s Ruling on postponing consideration of the case No АК/11838/17 (Russian version only) http://solutions.fas.gov.ru/ca/upravlenie-kontrolya-sotsialnoy-sfery-i-torgovli/ak-11838-17

[7] See “Apple Rus” executed a FAS warning”, FAS Russia press release of June 16, 2017 http://en.fas.gov.ru/press-center/news/detail.html?id=50507