Broadcom pledges W20b fund to exploit market power

US semiconductor maker Broadcom has pledged 20 billion won ($16.1 million) to support the local semiconductor industry as part of a deal to redress abuses of power in its business with South Korean customers, including Samsung Electronics. ) spontaneously devised a corrective action to establish a fund for .

On Monday, South Korea’s Fair Trade Commission announced interim corrective actions following nearly 130 days of consultations with Broadcom. The interim action came after he decided last August that the FTC would accept requests from US chip makers to voluntarily present corrective actions.

Broadcom forced South Korean smartphone makers, including Samsung Electronics, to sign long-term contracts for the supply of telecommunications components from South Korea’s antitrust watchdog, resulting in local customers’ limited access to alternative parts. I was under investigation for doing so.

With this proposal, Broadcom promised to provide 20 billion won in funding to small and medium-sized semiconductor companies here. Of the proposed amount, the company will use 7.7 billion won to train chip experts over the next five years, according to FTC officials, to help fabless companies establish and grow their businesses. proposed to use an additional 12.3 billion won for

At a briefing session held Monday at Sejong Government Complex, FTC antitrust director Shim Jae-sik said Broadcom was able to generate more than $700 million in revenue under its three-year component supply deal with Samsung. said.

Regarding the 20 billion won, Shim said, “It’s difficult to estimate the exact amount of damages, but it is certain that the amount of the fund (as proposed by Broadcom) exceeds the maximum fine that can be imposed on the company.” said.

The U.S. chipmaker plans to adopt an antitrust compliance board and set up a “consent order tracker” to track voluntary remedial actions, the regulator added.

Broadcom has also pledged not to engage in unfair business practices. It promised not to restrict the right of local customers to select parts and trade with rivals.The company also said it would not restrict his 3 for smartphone parts purchased by Samsung between March 2020 and July 2021. We promised to provide a year-long warranty service. Components installed on Samsung products include Galaxy Z Flip3 and Galaxy S22.

The Japan Fair Trade Commission said it will solicit comments from interested parties and authorities on the proposal from Tuesday through February 18.

In 2021, the FTC has approved a proposal to amend Apple Korea’s anti-competitive business practices and launch a program worth KRW 100 billion. In 2014, regulators also agreed that local tech giant Naver would donate nearly 100 billion won over three years to help small businesses and protect consumer rights.

Ji Ye Eun (yeeun@heraldcorp.com)