According to Reuters, Apple Inc. (NASDAQ:AAPL) was recently threatened with fines by Italy’s competition regulator. The regulator said they would fine the tech giant 300,000 euros if Apple Inc. (NASDAQ:AAPL) did not give free two year warranties to local customers, as it states in Italian law.
The Italian government has forced a two year warranty on all electronic products and other durable items while the manufacturer has no say in the matter. While this is great consumer protection, it can be harmful to businesses such as Apple Inc. (NASDAQ:AAPL) because their products have to last two years, otherwise they will have to replace the item which costs money. However, Italy is an important market in Apple’s European expansion but they need to make sure they do not set themselves up for failure as any missteps here could hurt the company’s presence in the country.
LItaly’s regulators have already fined certain divisions within Apple 900,000 euros, after Apple Inc. (NASDAQ:AAPL) failed to tell customers their free assistance rights. Additionally, the company lost an appeal to an antitrust fine earlier this year which totaled 300,000 euros.
Apple has not been on their best behavior in Italy and it could hurt their image in Italy. Italian regulators have now said that they are filling non-compliance complaints against Apple saying that the tech giant continues to conduct “unlawful” practices.
Apple needs to get with the program before they continue being forced to pay huge fines. Unfortunately, when you are a huge multinational corporation, you must follow every government’s nitty gritty laws such as Italy’s two year warranty law. Otherwise, you will just continue to be fined and have an unfavorable public opinion on your company. In most cases, compliance is the road to riches and Apple needs to not focus on its expansion rather than Italian non-compliance suits.
Still, Apple followers and analysts wait for the much anticipated unveiling of the iPhone 5. As you can imagine some analysts are already calling the smartphone a winner and the best phone of 2013. Bold words but Apple is going to need to deliver as the bar is now lifted even higher. Apple’s recent unveiling of the new Macbooks that feature the retina display will likely be a worldwide hit as well.
Aside from the new products coming out, Apple’s focus is on its worldwide retail expansion. Some new locations include London, New York City and Shanghai. These cities are expected to be big earners for Apple as they look for more strategic locations to open a retail location.
The bottom line here is that as Apple continues with its expansion plans, they are sure to hit roadblocks along the way. Unfortunately, the situation in Italy appears to be Apple’s doing mostly but the company still has a chance to turn relations around with Italian regulators.
However, that means giving Italian buyers free two year warranties which could end up costing Apple more than the proposed fine of 300,000 euros. The only thing that is for sure is that Apple continues to dominate the tech world as new products will surely take the company to bigger heights.