“Japanese regulators are considering taking action against Apple Inc over possible antitrust violations that may have helped it dominate the nation’s smartphone sales, government sources said, a move that could hit the company’s profit margins in one of its most profitable markets,” Yoshiyasu Shida reports for Reuters. “In a report published last month, Japan’s Fair Trade Commission (FTC) said that NTT Docomo, KDDI Corp and Softbank Group were refusing to sell older surplus iPhone models to third party retailers, thereby hobbling smaller competitors.”

“Apple was not named in that report, but two senior government sources told Reuters that regulators were also focusing on Apple’s supply agreements with all three carriers,” Shida reports. “Under those deals, surplus stock of older iPhones is kept out of the market and sent to overseas markets, such as Hong Kong, according to industry sources.”

“The carriers, locked in a costly battle to win consumers who covet iPhones, also bulk purchase the Apple smartphones and sell them at a discount, which gives the U.S. company an advantage over rivals such as Samsung Electronics Co, according to the two government officials and an industry source,” Shida reports. “Both iPhone 7 and Samsung’s Galaxy S7 edge model sell for 93,960 yen ($932) under Docomo’s main service package without any contract, but the cost for the iPhone drops sharply to 38,232 yen with a two-year contract, while the Galaxy falls to 54,432 yen.”

MacDailyNews Take: How much does the fire and water damage restoration cost? We wouldn’t know, we’ve only owned real iPhones, not explosive wannabes peddled to ignoramuses by an IP-trampling South Korean dishwasher maker (which seems to have gone crying to Japanese regulators like the whiny losers they are).

“The strategy has helped Apple sustain demand for new iPhones, making Japan one of its most profitable markets,” Shida reports. “The U.S. company accounts for almost one in every two smartphones sold in Japan, its largest share in a major market.”

Read more in the full article here.

MacDailyNews Take: So, in Japan, Apple’s not allowed to have contracts with carriers that stipulate exclusivity for said carriers by setting guidelines for the sale of older, surplus iPhone stock?

Japan’s Fair Trade Commission should beware the butterfly effect. For example: Apple paid 865 Japanese suppliers more than $30 billion in 2015.