Little over a year after it was hit with a $975 million anti-monopoly fine in China, chipmaker Qualcomm is now facing another hefty anti-trust fine, this time from South Korea.
According to a report in The Korea Times, Qualcomm is up against a fine of $879 million (1 trillion won) in South Korea stemming from a 17-month investigation into alleged violations of the country’s fair trade rules.
The fine would be the largest ever issued by South Korean anti-trust regulators if it is finalized, the report said.
South Korean regulators previously fined Qualcomm $200 million back in 2009 for anti-competitive business practices related to discounts it gave Korea customers for CDMA chipsets.
In acknowledging the new investigation in November 2015, Qualcomm said South Korean regulators have accused the company of improperly negotiating technology licenses and violating the country’s competition laws by licensing patents only at the device level.
The Korea Times said Qualcomm collects approximately $1.27 billion in royalty fees each year from Korean device manufacturers such as Samsung and LG Electronics. Korea accounted for 16 percent of Qualcomm’s total sales last year, the report said.
Qualcomm has refuted the allegations of wrongdoing, saying its practices adhere to industry norms.
“The allegations and conclusions contained in the (Examiner’s Report) are not supported by the facts and are a serious misapplication of law,” Qualcomm said at the time. “Our patent licensing practices, which we and other patent owners have maintained for almost two decades, and which have facilitated the growth of the mobile communications industry in Korea and elsewhere, are lawful and pro-competitive. Device level licensing is the worldwide industry norm, and Korean companies have long enjoyed the benefits and protections of access to our patents, which cover essentially the entire device.
The country’s Fair Trade Commission is planning to close the case by the end of the year, after reviewing Qualcomm’s response to the charges, according to the report.
Filed Under: Industry regulations