Broadcom addresses unfair practices, proposes measures worth $15.8 mn

Seoul, Jan 9

US chipmaker Broadcom offered 20 billion won ($15.8 million) worth of programmes to address concerns about its alleged violation of competition law, South Korea's antitrust regulator said on Monday.

The Fair Trade Commission (FTC) has been looking into allegations that Broadcom violated local laws by pressing Samsung Electronics Co. to ink long-term contracts for the supply of smart device parts.

The regulator believed that Broadcom has abused its position to force its partner to sign contracts with its capability to cut off shipments and technology support, reports Yonhap news agency.

Last year, Broadcom insisted that it will come up with voluntary corrective measures, which will include revising its policies and rolling out projects to help small and medium-sized businesses.

South Korean law allows a company accused of anti-competitive practices to state a correction scheme without deliberating whether those practices violate the country's competition act. The move is aimed at speedily resolving the case and remedying the damage to consumers without resorting to legal means.

Under the proposal, the U.S. chipmaker vowed to avoid limiting its business partners' right to choose components or trade with its rivals.

The company added it will offer warranty services of three years for components purchased by Samsung from March 2020 to July 2021. The smartphones installed with such parts include the Galaxy Z Flip 3 and the Galaxy S22.

Broadcom also plans to employ an antitrust compliance officer and establish what it calls "the Consent Order Tracker" to follow up its voluntary corrective measures.

As for the 20 billion won worth of projects, Broadcom said it will have the Korea Semiconductor Industry Association independently utilize the fund to foster chip experts and support fabless companies.

The FTC plans to gather opinions on Broadcom's proposal from related parties for 40 days from Tuesday to February 18.

In 2021, the FTC approved Apple Korea's proposal to fix its anti-competitive business practices and kick off programs worth 100 billion won. The move came after Apple came under fire for forcing the country's mobile carriers to pay the cost of television advertisements and warranty service for its iPhones.

c