Apple's South Korean offices raided by authorities ahead of regional iPhone X launch

Posted:
in iPhone edited November 2017
South Korean authorities have reportedly conducted a raid of Apple's offices in the country earlier this week, with investigators said to have questioned the company about its business affairs just days before the launch of the iPhone X in the country -- which could raise questions concerning the government's animosity for competitors of local manufacturers, such as main rival Samsung.




No official explanation for the raid has been provided, though it is believed by Metro the raid was part of an ongoing probe into "unfair" contracts between Apple and South Korean firms. Investigators are said to have asked Apple officials about its business practices, though it is unclear if the raid concerned just questioning or included the collection of documents or other evidence as part of the inquiries.

The investigation, launched last year, looked at the contract terms Apple required carriers to accept in order to sell iPhones, an issue that South Korea's Fair Trade Commission wanted rectified. These included provisions for carriers to buy a minimum number of iPhones, sharing the burden of repair costs, and the inability for repair firms to file lawsuits against Apple Korea for a year after a dispute.

While Apple did take action to address concerns about its contracts, it appears the probe is ongoing, with the raid likely to have been part of the investigation.

The timing of the raid, ahead of the iPhone X's launch on November 24, raises questions about the purpose of the raid. Pre-orders for the iPhone X ran out within 3 minutes of availability, according to GSMArena, with industry analysts estimating there to have been around 150,000 units allocated to the country.

The South Korean Fair Trade Commission also launched a task force in 2015 to find out if foreign smartphone producers were damaging the domestic market with their imported devices. The task force was created at around the same time Apple achieved a 33 percent share of the South Korean smartphone market.

Critics have previously complained about the South Korean Fair Trade Commission's activities, suggesting they are giving preferable treatment to local firms compared to those based outside of the country.

Endpoint Technologies Associates president Roger Kay accused the commission of having a "protectionist agenda," writing in Forbes in 2015 the agency had "pretty much run amok in recent years, slapping spurious charges on foreign companies."

Erik Telford, the president of the Franklin Center for Government & Public Integrity, suggested in The Hill the same year that the anti-trust agency "has exhibited alarming behavior that threatens the viability of companies doing business in South Korea."

South Korea's government has, in recent years, been under close scrutiny for corruption, following an investigation into Samsung's ties to the country's leaders. In August, Samsung Group head Jay Y. Lee was sentenced to five years in prison after a six-month trial, convicted of bribery and other charges that led to the downfall of former Korean President Park Geun-hye.
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Comments

  • Reply 1 of 39
    ktappektappe Posts: 771member
    I feel rather confident that Samsung paid for this raid to be conducted. 
    macseekercanadiandudeLukeCageedredmagman1979racerhomieSpamSandwichtallest skilwatto_cobraGeorgeBMac
  • Reply 2 of 39
    What chance does Apple have with Korea? They obviously don’t want competition, even though they copied Apple’s technology to begin with.

    Take a closer look and you’ll see that even the US judge residing over the Apple Samsung case is of Korean origins. Yes, judge Koh had given Samsung unwarranted credibility and objected and belittled most of Apple’s claims.

    Where there’s smoke there’s fire, and the Apple Samsung case stinks of CO2, just like this raid. 
    magman1979racerhomieanantksundaramRobPalmer9StrangeDayscornchipwatto_cobrajony0
  • Reply 3 of 39
    Rayz2016Rayz2016 Posts: 4,784member
    Well that’s not suspicious in the slightest. 
    edredviclauyycanantksundaramRobPalmer9ronncornchipwatto_cobrajony0
  • Reply 4 of 39
    Meanwhile, I the US the justice system is unable/unwilling to fine Samsung for what can only be described as flagrant copying and patent infringement...
    canadiandudemagman1979racerhomiepatchythepirateviclauyycRobPalmer9ronnwatto_cobrarevenantjony0
  • Reply 5 of 39
    ktappe said:
    I feel rather confident that Samsung paid for this raid to be conducted. 
    With the previous CEO going to jail for corruption/bribery/etc.?

    Maybe they just "asked nicely"!  :D
    RobPalmer9cornchipwatto_cobraGeorgeBMac
  • Reply 6 of 39
    Meanwhile, I the US the justice system is unable/unwilling to fine Samsung for what can only be described as flagrant copying and patent infringement...
    The US is, sadly, an increasingly subservient country. Subservient to special interests, subservient to anything that creates returns to its capital anywhere around the globe, and subservient to any place that will host our military. 
    magman1979RobPalmer9zimmermannwatto_cobrarevenant
  • Reply 7 of 39
    Well well, Apple its time to buy the company that built parts for Iphone....ie oled, memory etc and see how Korean corrupt govt reacts
    RobPalmer9watto_cobrajony0
  • Reply 8 of 39
    Kuyangkoh said:
    Well well, Apple its time to buy the company that built parts for Iphone....ie oled, memory etc and see how Korean corrupt govt reacts
    Apple can’t afford it. Samsung’s component business is just another part of a sprawling, massive conglomerate - finance/banking/construction/cars/healthcare/Ships/etcetc .The whole thing is something like 15% of South Korea’s economy . All in the 4 big chaebol in SK are something like 40% of their economy - such concentration of ownership does not happen much elsewhere and there is a whif of truth to what is good for Samsung is good for SK, that enables behaviours that elsewhere would be viewed as corrupt or protectionist
    racerhomieradarthekatwatto_cobrarevenant
  • Reply 9 of 39
    Rayz2016Rayz2016 Posts: 4,784member
    Kuyangkoh said:
    Well well, Apple its time to buy the company that built parts for Iphone....ie oled, memory etc and see how Korean corrupt govt reacts
    If you look at Apple's purchasing record, they're interested in companies that design and innovate; they don't tend to buy manufacturing outfits. 
    edredmagman1979Soliwatto_cobra
  • Reply 10 of 39
    slurpyslurpy Posts: 5,190member
    I read somewhere that iPhones are massively popular in SK. My friend visited there and said that's all he saw. 
    racerhomieRobPalmer9radarthekatwatto_cobra
  • Reply 11 of 39
    What a coincidence.

    /s
    watto_cobraGeorgeBMac
  • Reply 12 of 39
    anomeanome Posts: 1,303member
    slurpy said:
    I read somewhere that iPhones are massively popular in SK. My friend visited there and said that's all he saw. 

    I've heard the opposite. Not saying either position is right, just observing that the Android user I know who went there took some delight in going on about how the iPhone was not a thing in South Korea. Sales figures seem to suggest otherwise, but I suspect people see just what they want to see.

    Also, before it launched in Japan, a colleague claimed that people in Japan would only ever buy Sony phones because they only buy local stuff. Again, not borne out by the sales numbers.

    I'm also curious as to how long the authorities were held up by reception while Apple staff destroyed incriminating evidence. (Couldn't find a link for the raid on Samsung I'm referencing, but it seems they get raided every 6 months or so over corruption or tax evasion.)

    watto_cobra
  • Reply 13 of 39
    uroshnor said:
    Kuyangkoh said:
    Well well, Apple its time to buy the company that built parts for Iphone....ie oled, memory etc and see how Korean corrupt govt reacts
    Apple can’t afford it. Samsung’s component business is just another part of a sprawling, massive conglomerate - finance/banking/construction/cars/healthcare/Ships/etcetc .The whole thing is something like 15% of South Korea’s economy . All in the 4 big chaebol in SK are something like 40% of their economy - such concentration of ownership does not happen much elsewhere and there is a whif of truth to what is good for Samsung is good for SK, that enables behaviours that elsewhere would be viewed as corrupt or protectionist

    Samsung isn’t as big as you make them out to be. Samsung Electronics (which Apple passed a couple years ago) represents the majority of their revenues. Everything else Samsung does (that you mentioned) is only a fraction of the size of Apple.
    patchythepiratewatto_cobra
  • Reply 14 of 39
    I hope Tim Cook watches this closely.
    watto_cobra
  • Reply 15 of 39
    At this point Samsung (by way of the South Korean Govt. which is basically part of their company) seems want to create a trade type war. Or a nationalistic economic war. It's only a matter of time before some people start with the 'Buy Samsung support a foreign, crooked country." Why would they want to antagonize except wanting to push a trade war?
    viclauyycwatto_cobra
  • Reply 16 of 39
    wood1208wood1208 Posts: 2,026member
    Nothing new. Countries where laws,law officials and court systems are weak; raid, extortion,bribes,etc way of life and Korea is no different. This side show is to create anti-Apple feeling for South Koreans so they stay away from iPhone X purchase. If truth ever comes out, you may be surprised that Samsung is part of such conspiracy.
  • Reply 17 of 39
    anome said:
    slurpy said:
    I read somewhere that iPhones are massively popular in SK. My friend visited there and said that's all he saw. 

    I've heard the opposite. Not saying either position is right, just observing that the Android user I know who went there took some delight in going on about how the iPhone was not a thing in South Korea. Sales figures seem to suggest otherwise, but I suspect people see just what they want to see.

    Also, before it launched in Japan, a colleague claimed that people in Japan would only ever buy Sony phones because they only buy local stuff. Again, not borne out by the sales numbers.

    I'm also curious as to how long the authorities were held up by reception while Apple staff destroyed incriminating evidence. (Couldn't find a link for the raid on Samsung I'm referencing, but it seems they get raided every 6 months or so over corruption or tax evasion.)


    Rayz2016 said:
    Kuyangkoh said:
    Well well, Apple its time to buy the company that built parts for Iphone....ie oled, memory etc and see how Korean corrupt govt reacts
    If you look at Apple's purchasing record, they're interested in companies that design and innovate; they don't tend to buy manufacturing outfits. 
    Not to mention, a company that focus on copycat products.
    watto_cobraRobPalmer9
  • Reply 18 of 39
    On the face of it this all sounds very dodgy. However I can’t help wondering why S.Korean authorities would want to risk diplomatic relations with a nation it heavily relies upon for protection. Especially considering the ‘nut job’ they have to their north. Or am I overstating things a little?
    edited November 2017 watto_cobra
  • Reply 19 of 39
    wood1208 said:
    Nothing new. Countries where laws,law officials and court systems are weak; raid, extortion,bribes,etc way of life and Korea is no different. This side show is to create anti-Apple feeling for South Koreans so they stay away from iPhone X purchase. If truth ever comes out, you may be surprised that Samsung is part of such conspiracy.
    At this point Samsung (by way of the South Korean Govt. which is basically part of their company) seems want to create a trade type war. Or a nationalistic economic war. It's only a matter of time before some people start with the 'Buy Samsung support a foreign, crooked country." Why would they want to antagoniz, except wanting to push a trade war?
    Actually Korean is very patriot. Back in the Asian financial crisis, 1997, the Korean currency is super low and the government was really broke. So people voluntarily donated tons gold and money to the government to help out. Will other countries people do the same thing? I guess not.

    So Korean government can just asked their people to stop buying Apple and it might just work.

    But Korea is never a fair player in the world, from their  “sportmenship” and trade records, you can know about the country. Same as Chinese, Japanese and US.
    edited November 2017
  • Reply 20 of 39
    Imagine the damage that psychopathic  president Trump could do to Samsung in the USofA with a couple of his judiciously unhinged tweets. 
    macky the mackywatto_cobra
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