World - - Dec 28,2016
A South Korean regulator, Fair Trade Commission, said it would fine US Chipmaker Qualcomm Inc. $854 million (1.03 trillion won) for alleged antitrust violations.
The Fair Trade Commission (FTC), imposed a massive fine of 1.03 trillion won on Qualcomm Inc. The punishment is the single-highest fine ever imposed by the stated South Korean regulator.
The fine was announced after the FTC agency determined that the California-based company abused its market dominance. To this, the United States chipmaker said it will challenge the matter in court.
On Wednesday, the FTC ruled that the US company abused its dominant market spot and forced mobile handset makers to submit royalties for an unreasonably broad set of copyrights as part of sales of firm’s modem chips. The FTC said it launched its investigation into Qualcomm Inc.’s practices in 2014 following complaints from industry members, but did not name any specific companies.
The charge against the US firm marks the latest antitrust setback for Qualcomm’s supreme profitable business of licensing wireless rights to the mobile phone industry, at a time when the business is suffering a headwind from a cooling smartphone market.
The Korean regulator ordered Qualcomm Inc. to negotiate in respectable faith with rival chip manufacturers on patent authorizing and renegotiate chip supply contracts with handset manufacturers if needed - measures that would disturb the US Corporation’s dealings with key tech companies including Intel, Apple Inc., Huawei Technologies Co Ltd. and Samsung if upheld.
Qualcomm Inc. owns several important patents in the Code Division Multiple Access (CDMA) and Long-term Evolution (LTE) mobile standards. It charges mobile firms and other chipmakers with royalties for using its patents of CDMA and LTE.
The company has confronted with regulatory challenges around the world. The chipmaker was punished with $975 million last year by the Chinese regulators, ending an autopsy that threatened the US Firm’s growth in the world’s leading mobile market.