French regulators raid Apple offices over claims of starving resellers of new products

“Authorities searched the French offices of Apple and some affiliated companies as part of an investigation into retailing practices, a spokesman for the French competition regulator said on Tuesday,” David Jolly reports for The New York Times.

Jolly reports, “The news of the investigation in France was first reported Monday by Les Échos, a financial newspaper. The article said the investigators were interested in Apple’s relations with its distributors. The article cited the case of eBizcuss, an Apple premium reseller that operated about 15 stores until it collapsed last year. The eBizcuss chief executive, François Prudent, accused Apple of abusing its market dominance and of unfair competition, contending that the company had opened Apple stores around the country while starving its other authorized retailers of popular products like the newest iPads and iPhones. Mr. Prudent filed a complaint with the regulator.”

Read more in the full article here.

Related article:
France probes app stores over ‘lock-in,’ confirms raid on Apple – July 1, 2013

27 Comments

    1. Of course it is.
      It goes without saying though that Apple’s own stores will get inventory first simply because it will be an integral part of the supply chain. Would any business be any different since the profit margin is higher for their own stores.

      1. That’s as may be, but if Apple had a “Premium Reseller” program set up, and intended to make fewer products available to those stores without telling them in advance, the stores would not know to make allowances for changes in their business model, and would be harmed due to their confidence in the “Premium Reseller” program, which almost certainly implies that Apple represented that it was going to continue the reseller relationship with these stores, with everything that implies (including adequate supply of product).

        The legal term is “detrimental reliance,” and it’s something that can be – and is often – the basis of a lawsuit.

          1. And that’s what I like about Americans – our willingness to speak our minds, give people like you the middle finger, and that we don’t roll over like a quadriplegic kitten like the French did in World War 2.

  1. “We fight wars against the French. Did all those men die in vain on the field of Agincourt? What the man who burnt Joan of Arc simply wasting good matches?” — Edmund Blackadder

    =:~)

    1. MacFreek, good point except while the US has perfected crony capitalism, the French are perfecting crony socialism. Slightly different concepts, but the final results are the same.

  2. The real reason, left unsaid, is that the French authorities demanded that Apple run up a white flag 20′ in the air whereas Apple being a fundamentally American company refused.

  3. The French use this tactic when they are unable to compete. They’re not telling us that there PC sells are down and they know they might survive if they can give the people what they want. But this is socialism; the whaaan state. Cry to the government because apple won’t let them have there toys. Apple should pick up and move to another sand box; where others will follow and play fair.

    The French governments real angle (because there running out of money and they need cash settlements) is to go after apple cash hoards. The courts is the perfect venue coarse the money out of corporations who provide jobs legitimate employment for the people.

    Grow up France and start competing!

      1. But if the French government requires a minimum profit margin per unit for the premium partner, the partner becomes the competition. See how governments mess things up?

  4. Doesn’t Apple use a distributor network in Europe like they do in North America? To the best of my knowledge, companies like Ingram Micro handle inventory distribution in part, I’m sure, to negate any sort of favoritism toward Apple’s own stores versus third party resellers.

    This chain (and the French government) would need to prove that there was direct communication with the distributor(s) to favor Apple’s stores over independents. I’d be curious to see how other resellers in the country have fared in the same period. As has been written about many times, Apple’s own retail staff knows nothing about corporate decisions until they’re announced, just like everyone else.

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