Mobile TV handset makers want their money back in EU
Thursday, July 30th, 2009[Mobile TV Phone -img from TFTS]
Samsung Electronics and LG Electronics can get their money back from EU. A change in EU customs policy will make a tax refunding for these Korean mobile phone manufacturers, which produce mobile TV (DMB) phones.
Since WTO Information Technology agreement in 1996, all tariffs on mobile handsets are suppressed (tax-free in most cases in EU), allowing Korean manufacturers to compete fairly on European grounds with native players.
But concerning mobile TV devices, EU considered it as TV devices instead of mobile phones since 2007. Therefore, a 14% tariff has been applied. Due to this Samsung Electronics and LG Electronics have paid € 7.5 millions tax so far. However, according to the policy change, there companies can get tax refund.
As a matter of fact, it wax expected to lower tax rate for such multifunctional mobile phone after the enforcement of EU-Korea FTA (Free Trade Agreement). But the sooner this kind of positive market change comes, the more profits Korean players can make.
By the way, European mobile TV market is expected to reach 20 billions in 2011. Attractive prices and cash reserve will be valuable tools for Korean companies in the moment of truth.


