Apple's Export Compliance Policy Ambiguous, Leaves Room To Deny Sale To Farsi Speakers

 
on June 22 2012 5:15 PM
A customer holds up a pair of Apple's iPad 2
A customer holds up a pair of Apple's iPad 2 tablet after purchasing the second generation device at the Apple's flagship 5th Avenue store in New York in March. REUTERS

Apple Inc. (Nasdaq: AAPL) has become embroiled in controversy after reports that Atlanta-area Apple store employees refused sale of iPads and other merchandise to Farsi speakers and people of Iranian descent. At the center of the accusations of racial profiling is the company's Export Compliance Policy and how it is interpreting the U.S. embargo on Iran.

The North Point Mall Apple store employee who reportedly refused a sale to a Farsi-speaking U.S. citizen and University of Georgia student cited company policy prohibiting the sale of products to Iran. However, there are no U.S. regulations on the books that would have prohibited him selling to the woman. Apple's policy leaves the point ambiguous and open to interpretation.

Cupertino, Calif.-based Apple, in accordance with U.S. trade embargoes, lists Cuba, Iran, North Korea, Sudan, and Syria as prohibited destinations for exporting its merchandise. The exportation, re-exportation, sale or supply, directly or indirectly, from the United States, or by a U.S. person wherever located, of any Apple goods, software, technology (including technical data), or services to any of these countries is strictly prohibited without prior authorization by the U.S. government. This prohibition also applies to any Apple owned subsidiary or any subsidiary employee worldwide.

According to the U.S. State Department, the embargo against Iran doesn't apply to U.S. companies selling their products in the U.S. to individuals intending to use those products here.

There's absolutely no U.S. law that would prohibit Apple or any other company from selling its product in the United States to anyone intending to use their product in the United States, including Iranians or Persian speakers, State Department representative Noel Clay said Friday.

Apple appeared to be setting its own standard to enforce export-control regulations. Unless the Apple employee believed that the woman was seeking to buy an iPad expressly for the purpose of shipping it back to Iran, there is no reason he should not have sold to her.

Moreover, the fact that multiple allegations of Farsi speakers and people of Iranian-descent being denied sales by Apple employees are emerging makes it seem increasingly likely that Apple has been deploying its export compliance policy in a very broad and potentially discriminatory fashion. The company issued a statement to Al Jazeera on Friday, but it didn't expressly address the incidents of Farsi speakers being denied sales.

Our retail stores are proud to serve customers from around the world of every ethnicity. Our teams are multilingual, and diversity is an important part of our culture. We don't discriminate against anyone, Apple's statement said.

Apple shares rose $4.43 to $582.10 Friday.

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