France’s competition agency has announced a $1.23 billion fine against Apple saying the tech giant conspired with distributors of gadgets such as the iPad to fix prices and limit competition.
The decision came from France’s L’Autorité de la concurrence, which unveiled its largest fine ever. The agency said Apple required distributors such as Tech Data and Ingram Micro to charge the same prices for devices that could also be purchased through its own online and physical retail stores.
“It is the heaviest sanction pronounced against an economic player, in this case Apple, whose extraordinary size has been duly taken into account,” said Isabelle de Silva, the director of the agency in a statement.
The agency also respectively levied fines of $84.7 million and $69 million against Tech Data and Ingram Micro for their roles.
The French agency said the agreements involved Apple products and services, though not iPhones.
The case apparently has its roots in a dipute between Apple and one of its leading French resellers, eBizcuss. The latter accused Apple of abusing its position and in 2012 the reseller shut down in France as a result of what it claimed was unfair competition. The company was part of the Apple Premium Reseller program, which are stores that only sell Apple products.
The French agency said under the APR program, partners were told in advance how many of each product would be allocated to their stores. And they were required to charge the same amount for Apple products as did Apple. The result limited pricing competition for about half of the retail market for Apple products in France. In addition, the agency found that Apple limited supplies to APR partners during moments of heavy demand around the launch of new products to stear customers to its own stores.
Under French law, a company is not allowed to work with distribution partners to determine prices, and must treat them the same way they would treat their own internal sales channels. That includes allowing them to determine on their own how many and which products they wanted to order from the wholesaler, in this case Apple, the French agency said.