Chipmaker Qualcomm has pledged to appeal a 1.03 trillion won ($851.07 million) fine imposed on the company by South Korea's Fair Trade Commission (FTC) for alleged anti-competitive practices.
The FTC found Qualcomm to be in violation of Korean competition law with its licensing practices for key mobile chipset patents.
The agency held that Qualcomm had been abusing its dominant market position by forcing handset makers to pay royalties on patents they do not need as part of sales of modem chipsets, and also ordered Qualcomm to renegotiate supply agreements with handset makers if requested.
But in a statement, Qualcomm called the ruling “unprecedented and insupportable,” noting that the licensing practices in question have been in place in Korea and worldwide for decades.
The FTC also previously reviewed but did not question these practices during an earlier investigation into Qualcomm, the statement adds. The agency previously fined Qualcomm around $225 million in 2009.
Qualcomm pledged to file for an immediate stay of the order and appeal the KFTC’s decision to the Seoul High Court, as well as appealing both the size of the fine and the methodology used to calculate it.
“Qualcomm strongly believes that the KFTC findings are inconsistent with the facts, disregard the economic realities of the marketplace, and misapply fundamental tenets of competition law,” Qualcomm EVP and general counsel Don Rosenberg said.
“Qualcomm’s repeated requests during the KFTC’s investigation for basic due process rights such as access to the case files and the right to cross examine witnesses were denied. These rights and others are supposed to be guaranteed to US companies under the Korea-U.S. Free Trade Agreement, yet the KFTC declined to implement these fundamental procedural safeguards.”