Qualcomm probed for price-fixing in China







Qualcomm probed

for price-fixing in China



By Fang Dong and Jiang Chengguo



China’s top economic planning body confirmed on Wednesday of February 19 that it is conducting an antitrust investigation into U.S. mobile chip maker Qualcomm Inc.

The National Development Reform Commission (NDRC) said probe into Qualcomm started last year on complaints from Chinese industrial associations and lawyers.

These complaints accused Qualcomm of abusing its dominance in the wireless telecommunication copyright and cellphone chip markets.

Qualcomm was accused of unfair and discriminatory prices with unreasonable conditions, the NDRC said.

“The case is just a routine part of our work to maintain market order, and no specific body is targeted,” the NDRC stressed when responding to media reports that the central government intended to break Qualcomm’s dominance of the 4G market.

Qualcomm is the world’s largest manufacturer of wireless telecommunication products, holding 40 percent of the market in China and 30 percent in the world.

Manufacturers using Qualcomm chips have been asked to pay exorbitant patent fees of up to six percent of a phone price, over and above the cost on the chips themselves.

The China Communications Industry Association filed a report with the NDRC at the beginning of this year complaining about Qualcomm’s over-pricing, which they claim harms China’s mobile industry.

In 2009, South Korea fined Qualcomm around 252 million U.S. dollars for abusing its market position, the harshest punishment of its kind for a single company.

The NDRC said its preliminary investigation showed that to some extent, the accusations are well-founded but further investigation and analysis is needed.

In 2013, Qualcomm’s revenue rose 30 percent to 24.87 billion U.S. dollars, with 7.88 billion U.S. dollars coming from patents.






InterDigital vows to stop

discriminatory licensing


By Xu Feng


U.S. patent licensing company InterDigital Inc. has promised to stop discriminatory licensing practices against Chinese firms, China’s anti-trust authorities told Xinhua on Wednesday of February 19.

The wireless technology patent holder said it will license patents to Chinese telecom equipment manufacturing enterprises under fair, reasonable and non-discriminatory (FRAND) terms, according to the anti-monopoly bureau under the National Development and Reform Commission (NDRC).

InterDigital will stop charging Chinese companies licensing fees that are discriminatory and exploitative. It will not bundle the licensing of 2G, 3G and 4G mobile phone patents as a sign of respect for Chinese players’ right to choose, the NDRC said.

InterDigital has also promised to stop forcing Chinese companies to license some of their patents to it for free.

The NDRC will further study the case before making any decisions, it added.

The latest development came after the NDRC bureau announced on Feb. 10 that InterDigital had filed a commitments request and promised to work with Chinese authorities in the hope that China will suspend its ongoing investigation into the firm.

InterDigital has allegedly charged Chinese telecom firms like Huawei and ZTE higher patent royalty rates than it got from Apple Inc. and Samsung Electronics. It is also suspected of using unfair trade practices to force Chinese companies to accept the offer.

In October last year, a court in south China’s Guangdong Province ordered InterDigital to pay Huawei 20 million yuan (3.28 million U.S. dollars) in compensation for monopolistic practices.

On the excuse of fearing its officials being detained or arrested, InterDigital at one point refused to come to China in response to the investigation, before finally attending a meeting with NDRC officials last month, an occasion on which the two sides clarified their stances.







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