Apple has been facing several lawsuits in different regions around the world and the issues just keep increasing for the technology firm. In the latest development, it is said that Apple has to pay up to $46 million South Korea on benefits that it failed to declare.
Based on the data from Korea Fair Trade Commission, a lawmaker has come to the conclusion that technology giant Apple needs to pay $46 million. This is related to an investigation that found Apple guilty of antitrust behaviors.
In 2016, the US-based giant was accused of anti-competitive practices in South Korea. Given the popularity of its smartphones, the mobile carriers had to sell them and taking unfair advantage of its position, Apple was dictating terms. It was accused of imposing three onerous conditions on local carriers:
- Carriers had to buy minimum quantities of each model, dictated by Apple
- Carriers had to share the cost of warranty repairs or replacements
- Carriers had to pay to run Apple’s own TV ads for the iPhone
While Apple had settled the case by proposing a series of measures but the issue of dictating mobile carriers to pay for TV ads for the iPhones is coming to haunt the company.
Carriers had to pay the full cost of running iPhone ads on TV and they were only allowed to use Apple’s own ads. The carriers were permitted to only add their own logo to the final frame. This effectively gave free advertising to Apple, amounting to a taxable benefit that the company failed to declare.
It appears that Apple made local mobile carriers in Korea pay 20 to 30 billion won, for which Apple needs to pay 28.8 billion to 43.2 billion won in corporate taxes. But the total amount of corporate taxes the company should pay comes to 36.6 billion to 55 billion won when including additional taxes imposed for failing to report the corporate taxes.
The claim is from a minority party so it remains to be seen if anything comes out of it. But the timing is crucial as it comes at a time when Apple is under pressure in the country as Apple and Google are now required to allow developers to use third-party payment platforms in their app stores in Korea.
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