FTC Concerned Import Bans Are Being Used Anti-Competitively
When HTC found its shipments of the One X and EVO 4G LTE getting held up in customs, it was because of an order given by the U.S. International Trade Commission to block HTC imports meeting certain specifications. Ultimately, HTC demonstrated that its products weren’t in violation of this order, but the damage in terms of lost sales and disappointed customers was already done. Now the Federal Trade Commission is asking if these sorts of blocks are really being used as intended, or if they’ve become tools that are being taken advantage of to reduce industry competition.
The FTC’s not arguing that import bans be taken off the table altogether, but considering the impact they can have on a company, perhaps stricter standards should be employed in deciding when their use is appropriate. We haven’t learned of any specific guidelines for their use that the FTC may have in mind, but it clearly thinks that this is an issue worth discussing further.
In this HTC/Apple case, for instance, might there not have been a better way to enforce the ITC’s ruling? The imposition of fines might have let HTC make its deliveries on-time, yet still compensate Apple if those deliveries were later found to be in violation of the ITC’s order. It’s a stretch to imagine that Apple’s immediate sales were ever under any real threat from HTC’s devices, so an import ban could easily be seen as an excessive reaction.
There’s no sign that the FTC’s opinion is going to have any effect on how the ITC does business, but it’s reassuring all the same to hear the occasional voice of reason amidst all this legal business.