U.S. semiconductor company Broadcom said on Sept. 25 that it plans to file an administrative lawsuit against the Korea Fair Trade Commission (KFTC)’s decision to impose a fine on Broadcom.
“We regret the decision by the KFTC,” Broadcom said in a statement, adding that it plans to appeal to the Seoul High Court.
Earlier, the KFTC announced on Sept. 21 that it gave Broadcom a corrective order and imposed a fine of 19.1 billion won (US$14.3 million) on the company for abusing its power over Samsung Electronics, a violation of Korea’s Fair Trade Act.
The KFTC claimed that Broadcom allegedly pressured Samsung Electronics by stopping supplying semiconductor components for its smartphones and signed a long-term contract to purchase more than US$760 million worth of components from Broadcom annually for three years.
The KFTC’s verdict has the same effect as a first trial ruling. If a party appeals, it will be confirmed by the Seoul High Court and the Supreme Court in Korea.
“Broadcom has worked closely with Korean corporate customers in a fair and law-abiding manner for decades, contributing significantly to the innovation and success of the Korean economy and Korea’s large technology companies,” Broadcom said.
“We worked closely with KFTC officials to reach a fair, reasonable and mutually beneficial outcome for all parties involved but regrettably, the final consent resolution draft jointly prepared by Broadcom and the KFTC officials were rejected during a review process.”
The KFTC had accepted Broadcom’s application and prepared a consent resolution draft outlining the establishment of a 20-billion-won win-win fund for small companies. But in June, the KFTC rejected the consent resolution draft and resumed a review process for a punishment as victim Samsung Electronics and complainant Qualcomm both objected.