France’s Competition Authority: Orange Can’t Sell Apple’s iPhone Exclusively

iPhone 3G

France’s competition authority has ruled that Apple must immediately cease its relationship with France Telecom’s Orange where it has exclusive rights to sell Apple’s iPhone in France and allow other local carriers to offer the iPhone to its subscribers.

The watchdog has cited that Apple’s exclusive arrangement with Orange poses a serious and immediate threat to competition in the wireless sector.

Orange is currently the exclusive carrier of Apple’s iPhone in France and today’s ruling by France’s competition authority puts this 13 months relationship under threat.

France’s third largest mobile operator Bouygues Telecom had filed a
complaint with the watchdog regarding the deal between Apple and its
larger rival, French Telecom. They argued that it violated freedom of competition and pricing laws in France.

Based on its initial investigation, France’s competition authority seems to agree and has given a temporary judgement in favor of Bouygues as a precautionary measure while the watchdog continues to investigate the merits of Bouygues’ claims.

It believes that Apple’s exclusive arrangement with
Orange to sell iPhone in France "by nature introduces a new factor of rigidity in a
sector that already lacks competition."

As per the ruling, Apple and French Telecom are also prohibited from entering into any other exclusive agreements for new iPhone models during the precautionary period.

Folks at Bouygues Telecom are pleased with the judgement and have applauded the regulator’s decision. On the other hand, French Telecom plans to appeal the decision.

We will let you know the final outcome of the competition authority’s investigation.

[via Apple Insider]




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