What are the details of the secret agreement that Apple made with China?

Leaked confidential documents reveal that Apple CEO Tim Cook secretly signed a five-year agreement with China to ensure the company's success and obtain special privileges and in return the American company will invest hundreds of billions of dollars in the Chinese economy, according to a new report.

What's the story

The Information has published a new report that gives us a behind-the-scenes look at how Apple has made concessions to Beijing and secured key legal waivers as CEO Tim Cook pressed officials about threats to its hardware and services and his interventions paved the way for unparalleled success in the country.

For the first time in years, the iPhone recently became the best-selling smartphone in China and Apple's second largest market after the United States, but the American company owes much of this success to its CEO Tim Cook, who laid the foundation stone for this success years ago when he secretly signed an agreement Its value is estimated at more than $275 billion.

In the agreement that Cook struck, Chinese officials promised that Apple would play its part in developing China's economy and share its technology expertise through investments, business deals and worker training. Those concessions Cook made to the Beijing government were of course not free.

Cook Agreement with China

And the secret agreement that Cook drew up during the first of a series of personal visits he made to China in 2016, during which he managed to cancel a sudden wave of regulatory actions against Apple's business there, as internal documents presented by The Information showed that Apple executives were trying to Ways to improve and perhaps salvage the company's relationship with Chinese officials who believed that the American company was not contributing enough to the local economy, as the Beijing government intended to take countermeasures, as well as the bad publicity that accompanied it, which eventually led to a decline in iPhone sales in the Chinese market.

A cornerstone of Cook's strategy was a memorandum of understanding between Apple and the National Development and Reform Commission (China's economic planning agency). The 1250-word agreement was originally drawn up by Apple's legal team in China as a way to improve relations with Beijing and win over senior leaders.

According to a person familiar with the agreement, face-to-face meetings with top Chinese officials became a priority for Apple executives after the country's regulators shut down the iTunes Books and Movies division in April 2016.

Five days later in Beijing, Cook, chief operating officer Jeff Williams, and chief legal officer Lisa Jackson publicly met with senior government officials at the Zhongnanhai presidential palace. Twelve issues favored by China included a pledge to help Chinese manufacturers develop more advanced technologies and support the training of Chinese talents.

Apple also promised to use more components with Chinese suppliers, sign deals with Chinese software companies, collaborate on technology with Chinese universities, and invest in Chinese technology companies, and the US company said it would invest billions of dollars more than it currently spends in the country.

According to internal documents, Apple will spend up to more than $275 billion in five years, and the agreement can be extended for an additional year until May 2022 automatically if neither side objects.

Source:

theinformation