South Korea’s antitrust regulator announced on Thursday that it has decided to impose a 19.1 billion-won (US$14.3 million) penalty on U.S. chipmaker Broadcom Inc. for its unfair practices against Samsung Electronics Co.
The Fair Trade Commission (FTC) said that Broadcom took advantage of its market dominance and used unlawful tactics, such as cutting off its supply and technical support, to make Samsung sign a long-term agreement in 2020.
The contract obligated Samsung to purchase Broadcom components worth $760 million per year from 2021 to 2023, and to pay for any shortfall if the amount fell short.
The FTC noted that Broadcom holds a major share in the market for advanced and high-performance mobile device parts used in smartphones and tablets.
The regulator had previously rejected Broadcom’s offer to voluntarily correct its unfair business practices with 20 billion won, in favor of Samsung.
The FTC said that the proposal was inadequate to restore the fair trade order and protect the interests of other industry players.