Iran threatens to ban Apple phones

Iran threatens to ban Apple phones
An unofficial Apple store in Iran.
By bne IntelliNews July 19, 2016

The Customs Administration of Iran has announced that Apple Electronics has one week to find a local agent in the Islamic Republic or have their products banned.

Iran's government, as part of its new push to normalise business for international companies, has demanded that all foreign electronic firms have official representation in the country, offering servicing and warranty for customers.

The government initiated this policy over 12 months ago in the auto sector, forcing the shutdown of thousands of unofficial showrooms in the country, and now it has moved to mobile phones, a market that exceeds $1.8bn in sales annually.  

The director of the Customs Adminstration's taskforce, General Abbas Nakhei, said that the new directive has been disseminated to all regions in the country and will take immediate effect after July 22, according to Tasnim News Agency.

Nakhei added that all previously bought mobile phones wouldn't be taken off their owners but they too would have to register them with the national database.

Retailers panic

In response, mobile phone retailers who sell the Californian-designed phones have quickly responded by removing the items off the shelves in their stores.

Counterfeit and smuggled electronics are a major issue in the Islamic Republic, where some retailers sell fake versions of best selling phones such as the Apple iPhone next to genuine items, fooling unsuspecting customers who buy them thinking they are the real deal.

The customs official previously stated that officially imported phones were now being registered with their IMEI codes on a national database, available to the police and national security officials.

Iran's mobile network operators are also taking part in the wider crackdown on unregistered phones and will also request their customers to add their IMEI numbers to the national database.  

Critics of the plan have said the new rules are unenforceable because of the number of phones flowing into the country from several borders, the majority of which are smuggled in.

One independent retailer, speaking on anonymity said "If they seriously think they can switch 90% of the smuggled phones off they are kidding themselves."

Another retailer at one of Tehran's mobile phone bazaars, called Charsou, said he was now resorting to opening the packaging on the iPhones and inserting SIM cards and selling them as second hand to avoid the new law. 

Prior to this announcement, another government official, Habibollah Haqiqi, said on July 7, "As a counter measure, the taskforce is trying to reduce the import tariffs from 7% to 5%," ISNA reported at the time.

History of Apple in Iran

This is not the first anti-Apple crackdown in the country either. There were reports in 2014 when a series of products were removed from the shelves of a company in Tehran which claimed they "were the official representative of Apple in Iran".

The Iranian police force in that case responded to the shutdown of the store, saying they didn't get official permission from the Iranian government.

Although the current number of Apple stores in Iran is put at thousands, with many of them saying they have official distribution rights from the American company, up to this point Apple has denied dealing with any of the third party companies selling their items.

The case of Apple is further complicated in Iran because sanctions remain in place for American companies, banning them from conducting business with Iranian entities altogether.

Currently the US' Office of Foreign Assets Control (OFAC) has not authorised the American electronics company to do business with Iran.

Apple has also said it doesn't plan to enter Iran at any point soon considering the financial restrictions remaining in place since the historic Joint Comprehensive Plan of Action (JCOPA), which was signed a year ago.