European Union Looking Into iPhone Contracts After Carriers Complain They Stifle Competition

Regulators over in Europe are checking into Apple’s deals with cellphone carriers after complaints that the iPhone contracts the company uses stifle competition. There are no formal complaints yet, but a group of wireless carriers banded together to submit info about their various contracts to the European Commission, in a move reportedly started by French carriers.

The New York Times reports that the accusations focus on Apple’s contracts with carriers in France, but other countries could be involved. The European Commission, which oversees antitrust enforcement for the EU, confirms that it received info on the Apple deals but hasn’t begun a formal antitrust investigation.

It won’t do so until the commission receives a formal complaint regarding anticompetitive behavior, but just the fact that it’s even checking out the contracts could suggest it’s not about to brush anything off.

“We have been contacted by industry participants and we are monitoring the situation, but no antitrust case has been opened,” said a spokesman for Joaquín Almunia, competition commissioner of the EU.

An Apple spokeswoman responded to the news by saying, “Our contracts fully comply with local laws wherever we do business, including the E.U.”

The issue at hand could revolve around reports that Apple’s contracts with smaller European carriers are stricter than the ones it holds with bigger companies.

It’s those allegedly strict conditions that can make it tough for other phone makers to compete: According to the NYT, Apple will set a quota of how many iPhones a carrier needs to sell over a certain period of time, which means those carriers might feel pressure to hustle harder when selling iPhones to a customer over a competing handset.

And if you as a carrier don’t want to agree to the quota? You can’t sell the iPhone. Can’t meet the quota? You have to pay for unsold devices, says one source.

The next move will come from the European Commission, which often takes a look at complaints and talks to the parties involved before moving on to formally investigate. If the complaining companies can provide good evidence that Apple’s actions are harming consumers, the commission may be prompted to act.

Europe Weighs iPhone Sale Deals With Carriers for Antitrust Abuse [New York Times]