[Alpha Biz= Paul Lee] Broadcom has lost its legal challenge against a fine imposed by South Korea’s antitrust regulator over allegations of unfair business practices involving Samsung Electronics.

The Administrative Division 6-1 of the Seoul High Court ruled on May 13 against Broadcom in its lawsuit seeking to overturn corrective orders and a fine of approximately KRW 18.6 billion (around $13.5 million) imposed by the Korea Fair Trade Commission (KFTC).

The case stems from a September 2023 decision by the KFTC, which found that Broadcom had violated fair trade laws by abusing its superior bargaining position in transactions with Samsung Electronics.

According to the regulator, Broadcom pressured Samsung into signing a long-term supply agreement requiring annual purchases exceeding $760 million over a three-year period. The pressure allegedly included threats to suspend the supply of key semiconductor components used in smartphones.

Broadcom is a major supplier of critical components, including chips that enhance radio frequency performance, and holds a significant market share in the segment. The KFTC concluded that Samsung had little choice but to comply with Broadcom’s demands to avoid production disruptions, particularly during the launch of flagship devices such as the Galaxy S20.

The regulator estimated that Samsung incurred additional costs of at least $160 million (approximately KRW 213.7 billion at the time) due to restrictions on component selection. Samsung has previously claimed total damages of approximately $326.3 million (KRW 437.5 billion).

Broadcom filed the lawsuit in November 2023 in opposition to the KFTC’s decision.

Under South Korean law, KFTC rulings carry the same effect as a first-instance court judgment. Parties seeking to challenge such decisions must proceed through appellate review at the Seoul High Court and ultimately the Supreme Court of Korea.

 

 

[ⓒ 알파경제. 무단전재-재배포 금지]