Apple Inc. has been the subject of criticism and legal action since its founding. This include its handling of issues related to labor violations at its outsourced manufacturing hubs in China, environmental impact of its supply chains, tax practices and monopoly practices.
Labor conditions
editApple Inc. manufactures most of its products in China through partners like Foxconn. Apple's decision to outsource its manufacturing has received significant criticism, due to allegations of poor working conditions, long work hours, and other labor rights violations.[1][2] A total of 18 suicide attempts were recorded at the Foxconn facility in 2010, with 14 attempts resulting in deaths.[3][4][5]
Apple, Foxconn and Chinese workers are stakeholders in high-technology production, but relations between the three are perceived by analysts as imbalanced. Apple was able to capture 58.5 percent of the value of the iPhone, despite the fact that the manufacture of the product is entirely outsourced. Particularly notable is that labor costs in China account for the smallest share: 1.8 percent, or nearly US$10, of the US$549 retail price. While both Apple and Foxconn rely on Chinese workers to perform 12-hour working days to meet demand, the costs of Chinese labor in processing and assembly are insignificant in the overall commercial success of Apple. Other major component providers—such as Samsung and LG—captured slightly over 14 percent of the value of the iPhone, while the cost of raw materials was just over one-fifth of the total value (21.9 percent).[6]
Taxes
editApple has created subsidiaries in low-tax places such as Ireland, the Netherlands, Luxembourg, and the British Virgin Islands to cut the taxes it pays around the world. According to The New York Times, in the 1980s Apple was among the first tech companies to designate overseas salespeople in high-tax countries in a manner that allowed the company to sell on behalf of low-tax subsidiaries on other continents, sidestepping income taxes. In the late 1980s, Apple was a pioneer of an accounting technique known as the "Double Irish with a Dutch sandwich", which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean.[7][8]
There is also a decade-long dispute between Apple and the European Commission regarding the tax arrangements between Apple and Ireland, which allowed the company to pay close to zero corporate tax over 10 years.[9]
Antitrust
editUnited States v. Apple is a US lawsuit brought against Apple Inc in 2024. The United States Department of Justice (DOJ) alleges that Apple violated antitrust statutes.[10][11] The lawsuit contrasts the practices of Apple with those of Microsoft in United States v. Microsoft Corp., and alleges that Apple is engaging in similar tactics and committing even more egregious violations.[12] This lawsuit comes in the wake of Epic Games v. Apple and the enforcement of the Digital Markets Act in the European Union.[13]
Environmental impact
editApple has received both praise and criticism for its environmental practices, the former for its usage reduction of hazardous chemicals in its products and transition to clean energy supplies, and the latter for its wasteful use of raw materials in manufacturing, its vigorous opposition to right to repair laws, and the amount of e-waste created by its products.[citation needed]
References
edit- ^ "Study Casts Doubts on Apple's Ethical Standards". China Labor Watch. February 24, 2016.
- ^ "Poor Working Conditions Persist at Apple Supplier Pegatron". China Labor Watch. October 22, 2015.
- ^ Lau, Mimi (December 15, 2010). "Struggle for Foxconn girl who wanted to die". South China Morning Post. Wuhan, Hubei.
- ^ Tam, Fiona (October 11, 2010). "Foxconn factories are labour camps: report". South China Morning Post.
- ^ "Foxconn worker plunges to death at China plant: report". Reuters. November 5, 2010.
- ^ Chan, Jenny; Ngai Pun; Mark Selden (2013). "The politics of global production: Apple, Foxconn and China's new working class". New Technology, Work and Employment. 28 (2): 104–105. doi:10.1111/ntwe.12008. S2CID 154073206.
- ^ Duhigg, Charles; Kocieniewski, David (April 28, 2012). "How Apple Sidesteps Billions in Taxes". The New York Times. Archived from the original on January 1, 2022. Retrieved April 29, 2012.
- ^ Drawbaugh, Kevin; Temple-West, Patrick. "Untaxed U.S. corporate profits held overseas top $2.1 trillion: study". Reuters. Archived from the original on November 14, 2015. Retrieved February 11, 2015.; "Apple Earnings Call". Apple Inc. Archived from the original on May 1, 2016. Retrieved April 28, 2016.
- ^ Houlder, Vanessa; Barker, Alex; Beesley, Arthur (30 August 2016). "Apple's EU tax dispute explained". Retrieved 22 February 2023.
- ^ McCabe, David; Mickle, Tripp (March 21, 2024). "U.S. Sues Apple, Accusing It of Maintaining an iPhone Monopoly". The New York Times. Retrieved March 22, 2024.
The Justice Department and 16 state attorneys general filed an antitrust lawsuit against Apple on Thursday, the federal government's most significant challenge to the reach and influence of the company that has put iPhones in the hands of more than a billion people.
- ^ "Justice Department Sues Apple for Monopolizing Smartphone Markets". U.S. Department of Justice. Retrieved 29 March 2024.
- ^ Song, Victoria (2024-03-21). "US v. Apple: everything you need to know". The Verge. Retrieved 2024-03-21.
- ^ Radel, Felecia. "What the DOJ lawsuit against Apple could mean for consumers". USA Today. Retrieved 22 March 2024.