Japan officials accuse Apple of pressuring electronics makers

Japan trade officials say Apple forced electronics companies to provide technology and IP to produce parts for free. (Getty Images)

Japan’s Fair Trade Commission is investigating Apple for putting pressure on Japanese electronics parts makers and whether Apple broke antimonopoly rules, according to reports released Tuesday.

A report in The Mainichi newspaper said the Japan FTC surveyed companies and found that Apple, in signed contracts, forced firms to provide technology and intellectual property needed to produce parts free of charge.

When one company called Apple’s practice an infringement of IP rights and demanded a contract revision, Apple threatened to end the business relationship, according to the report that appeared in The Mainichi, a Japanese daily.

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The Japanese FTC discovered Apple’s actions in a survey with Japanese businesses in late 2018, and in follow-up interviews.

The report said that Apple began business talks with about 10 Japanese electronics and optical parts makers and then insisted that their contracts include a clause allowing Apple and its affiliates be allowed to use technologies, knowledge and other IP of the Japanese firms for free.

One Japanese manufacturer complained it was banned from providing products to companies other than Apple and was forced to do so on the condition it pay the costs of settling any disputes with Apple. Another firm said Apple stirred price competition and lowered prices of parts it procures by disclosing technologies provided by Japanese companies to other parts makers. One company said it complied with Apple’s demand because it didn’t want to lose business with Apple in the future.

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A public relations representative for Apple Japan denied its parent company signed unfair contracts with Japanese firms.

“It’s impossible for the headquarters to sign unfair contracts from the standpoint of compliance with legislation,” the Apple official told The Mainichi.

The practices that Apple is accused of undertaking are similar to ones that U.S. chipmakers have accused Chinese companies of doing for years.

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