Husic Accuses Apple Of ‘Misleading’ IT Pricing Inquiry

Ed Husic has been left scratching his head overnight. He compared the notes of Apple’s testimony to a Congressional Inquiry to the notes he took when Apple testified before the Australian IT Pricing inquiry, and found that the two didn’t quite match up.

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Husic spoke before the Parliament yesterday about his findings (emphasis added):

Following months of wrangling and the extraordinary issue of a summons, Apple Australia appeared before a hearing in March of the House of Representatives Standing Committee on Infrastructure and Communications which is inquiring into why there are major price differences in the cost of IT products compared to overseas. At the hearing I tried repeatedly to get answers as to how it sets prices. I quizzed Apple Australia’s Managing Director Tony King, for example, asking him:

So it would be an agreement between you and your Apple US parent in terms of obtaining hardware to sell here. iPads, iPhones, Macbooks are all purchased from your overseas parent?

He answered:

Correct. Apple Australia would purchase hardware and software from Apple overseas.

Just note the last few words and contrast those to the first concrete response to my question.

Apple Australia also said:

We set our prices worldwide from Cupertino with input from the local team …

But the US Senate report says the price is determined by Apple Singapore, not the US. I am concerned the committee inquiry has been misled, either deliberately or accidently.

The corporate structure detailed in the US Senate report was never offered by Apple Australia and when pressed on its transfer pricing or price setting, I put it to the House that Apple deliberately avoided setting out the detail that became evident in the US Senate report.

I call on Apple Australia to either correct the record or provide further detail as to the way it actually prices its products for Australian consumers.

Apple Australia today said won’t comment on the matter.

It’s interesting to see that these claims have been aired so close to the tabling of the final report into IT Pricing in Australia, which we expect to be presented to the Parliament in the coming months. It’s highly unlikely that any managing director would willingly mislead a Parliamentary Inquiry, however.

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