Russian, the land of ballet, borscht, and the world’s largest ceremonial bell, is allegedly also home to practices of a more unsavory sort — price fixing. That’s according to Russia’s Federal AntiMonopoly Service (FAS), which on Monday accused iPhone maker Apple of price-fixing devices in the country. It’s opened a case against the Cupertino, California-based company.
The allegations apparently sprung from “a citizen with information” about incongruities in Russia’s smartphone resale market. According to FAS investigators, 16 unaffiliated third-party retailers maintained an agreed-upon price for Apple’s iPhone 6s and 6s Plus models “for a certain period of time” — as early as October 2015. “The Anti-Monopoly Service sees signs of price-fixing violations in the Russian Federation at Apple iPhone resellers, which resulted in the same prices for these smartphones,” the agency said in a statement.
The formal filing follows months of legal discovery by FAS head Andrei Filimonov. Russian news agency Interfax reports that a delegated unit began looking into claims of iPhone price-fixing in February.
According to Fortune, the focus of the FAS investigation is determining whether Apple pressured retailers in Russia to “treat its recommended product prices as mandatory.” If it finds any evidence of wrongdoing, it has the authority to levy substantial fines — up to 15 percent of iPhone sales revenue.
Apple on Tuesday characterized the agency’s accusations as baseless. “Resellers set their own prices for the Apple products they sell in Russia and around the world,” a spokesperson for the company told Fortune. Two of the retailers accused of conspiring to collude, MTS and Euroset, Russia’s largest mobile phone retailer, denied that they had coordinated pricing.
The FAS decision was criticized by Dmitry Marinichev, Russia’s government-appointed internet ombudsman, who argued that retailers, not Apple, deserved the agency’s scrutiny. “It won’t be possible to punish Apple,” he said. “It’s a commercial company and therefore it works on the free market and defines for itself what the pricing level should be for a given market.”
It’s not the first time Apple’s found itself in hot sbiten. A Russian lawsuit against the company in July alleged that Apple “did not sufficiently support” its products in the country — specifically, that Apple stores and third-party repair facilities in the country lacked the “advanced calibration equipment” and expertise needed to repair broken phones and tablets. The Moscow Times reported earlier this month that the company will open a repair center in Russia later this year.
Apple’s not the only American tech company that’s found itself in the Russian government’s crosshairs. In 2014, the FAS found Google guilty of abusing its position in the Russian mobile industry by stifling search engines and services that competed with its own — a judgment that Moscow’s Arbitration court upheld in March. And in 2014, Google, Facebook, and Twitter ran afoul of a law that requires tech companies to store Russian users’ personal data on servers within the country’s borders.