LONDON Samsung Electronics is being investigated for allegedly selling NAND flash memory chips to Apple at well below the market rate.
South Korea’s Fair Trade Commission (FTC) confirmed Wednesday (Nov. 23) it is probing the deal.
FTC Chairman Kang Chul-kyu suggested last month that the agency might take action against an alleged unfair deal between Samsung and Apple, if local manufacturers of MP3 players request the probe.
Claims that Apple had won significant perhaps 50 percent price discounts from Samsung as part of a large upfront order surfaced soon after Apple launched its iPod Nano player.
“We are looking into whether the allegations are true or not. We will ask Samsung to correct the practices if it unfairly sold the chips at a cheaper price to Apple than to domestic customers,” said a spokesman for the Fair Trade Commission.
Samsung has denied that it was a case of unfair pricing. “We have many deals with Apple. We may get less from one deal but more from another deal. So I think we get fair value overall,” Chu Woo-sik, head of investor relations, said last month.
The investigation follows the announcement earlier this week by Samsung, Toshiba and Hynix Semiconductor that they won long-term contracts to supply NAND flash memory chips to Apple, which is using them in its iPod Nano music players.
Also this week, Intel announced a deal to supply flash memory chips to Apple and unveiled a joint venture with Micron Technology to manufacture NAND flash memory chips.