The KFTC imposed corrective orders and a surcharge of KRW 273.2
billion against Qualcomm Inc. (‘Qualcomm’). A consensus was reached
that discriminatory payment of loyalty rebate and rendering conditional
rebate by Qualcomm excluded competitors from the market and
undermined competition.
Qualcomm, the dominant firm, which represented 99.4% of the code
division multiple access (CDMA) modem chip market (as of 2008) with its
original CDMA technology, excluded its competitors and maintained its
monopoly in the market by 1) charging discriminatively high royalties for
mobile handset makers using non-Qualcomm chips, when licensing its
CDMA technology, 2)concerning the sale of its CDMA modem/RF chips to
mobile handset makers, offering rebates on condition that they meet great
portion of their demand with Qualcomm chips, and 3) when licensing its
CDMA technology to mobile handset makers, entering into contracts that
allowed Qualcomm to get 50% of the patent royalty for its technology even
after the concerned patent expired or became invalid.
This case resulted in a strong enforcement action against the high-tech
company following very complex and sophisticated legal and economic
analysis and fierce debate between the case examiners and the respondent.
In this respect, the case is believed to serve as a significant milestone for
other antitrust cases involving high-tech industries.