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Are Apple Retailers Racist or Just Following the Rules?

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The following disclaimer is found on the Apple’s (AAPL) export compliance webpage:

The U.S. holds complete embargoes against Cuba, Iran, North Korea, Sudan, and Syria

The exportation, reexportation, 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.

It is this language – in particular “wherever located” – that likely led an Apple Store in Alpharetta, Georgia to refuse sale of an iPad based on a customer’s race.

According to a report from Atlanta’s WSB-TV, an Apple sales representative refused to sell Sahar Sabet, a 19 year-old University of Georgia student, and her uncle an iPad because they were speaking Farsi. After learning the customers were from Iran, despite being US citizens, the salesperson exclaimed:

“I just can’t sell this to you. Our countries have bad relations.”

A similar incident occurred at another Apple Store nearby, where an Iranian student with a US visa was denied sale of an iPhone because he and his friend were speaking in Farsi. In this case, the sale could be argued to be against Apple policy, but it’s actually not. Sale of items to Iranians within the United States is not prohibited. Exports to the country are.

This hasn’t stopped Iranian’s love affair with the iPad, which Minyanville reported on last year. Most Apple products found in the Islamic Republic make their way through Dubai and certainly aren’t smuggled in by Iranian-Americans acquiring their stock from Peach State outlets.

The Council on American-Islamic Relations and the National Iranian American Council both have called on Apple to change its policies and retrain its employees.

The best Apple has done so far is apologize to Sabat over the phone, and tell her she can purchase the iPad online.

Way to go, Cupertino!

(See also: Iran's Love Affair With the iPad)
POSITION:  No positions in stocks mentioned.