South Korea Fines US Broadcom 19.1 Billion Korean Won: Forcing Samsung to Sign Unfair Contract | Committee | United States
The Fair Trade Commission of South Korea announced on the 21st that it has issued a correction order and imposed a fine of 19.1 billion Korean won on Broadcom and its subsidiaries for forcing Samsung Electronics to sign an unfair contract through unfair means such as interrupting the supply of mobile phone parts.
The Fair Trade Commission of South Korea stated on the same day that Broadcom used its dominant market position to force Samsung Electronics to sign a long-term contract with it in March 2020. The contract stipulates that Samsung Electronics needs to purchase at least $760 million worth of components from Broadcom every year. If the actual purchase amount is lower than this level, Samsung Electronics needs to compensate for the difference.
The Fair Trade Commission of South Korea believes that during the contract signing process, Broadcom exerted unfair pressure on Samsung Electronics by suspending order approval, shipping, and technical support, forcing Samsung Electronics to accept unequal terms.
The Fair Trade Commission of South Korea pointed out that Broadcom's behavior is an abuse of its advantageous position, which has limited Samsung's choice of parts, hindered its diversified strategy of parts supply chain, and increased its cost burden due to the inability to use cheaper parts from other companies. Broadcom's competitors have also been deprived of the opportunity for fair competition.