Local structural and electronic properties around Fe in multi-component Cd$_{0.99}$Fe$_{0.01}$Te$_{0.97}$S$_{0.03}$ system were studied by means of X-ray absorption fine structure (XAFS). Composition of non-polar (110) surfaces of Cd$_{0.97}$Fe$_{0.03}$Te and C$_{0.99}$Fe$_{0.01}$Te$_{0.97}$S$_{0.03}$ systems and mechanism of their oxidation in ambient conditions were studied by Atomic Force Microscopy (AFM) and X-ray Photoelectron Spectroscopy (XPS). It has been found that Fe preferentially

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... stitutes Cd, but due to much smaller covalent radius and preferences for paring with S, it causes local distortion of the host CdTe lattice. The distortion is confined to the Fe-immediate surrounding and the second and third coordination shell atoms are (inside experimental uncertainties) placed at distances expected in CdTe. Although local structure around Fe is well defined in the bulk of both samples, their near-surface region is completely depleted from Fe, and in case of Cd$_{0.99}$Fe$_{0.01}$Te$_{0.97}$S$_{0.03}$ somewhat enriched in S. Special attention is, therefore, paid to characterization of the near-surface region and evaluation of its composition and structure. To that end we have introduced a general standard-free algorithm for XPS data analysis of the two-layer surface structure (bulk, oxide layer, and the impurity layer). Results of the in-depth composition analysis revealed that despite different bulk composition and impurity layer thickness, underneath the topmost impurity layer lays approximately one monolayer of CdTeO$_3$ which passivates the surface.