Qualcomm, one of world’s leading mobile processor manufacturers, has been accused of overcharging and abusing its market position in China by China’s anti-monopoly regulator.
The National Development and Reform Commission (NDRC) on Wednesday said that it had launched anti-monopoly investigations into US technology firms Qualcomm and InterDigital.
The watchdog, in its first public statement about the Qualcomm investigation, said that it began investigating the firm in June last year after the regulator received complaints that the San Diego-based company was charging discriminatory higher prices in China than in other countries.
Xu Kunlin, director general of the NDRC’s price supervision and anti-monopoly bureau, addressing a press conference in Beijing said that “We received reports from relevant associations and companies that Qualcomm abuses its dominant position in the market and charges discriminatory fees.”
The NDRC’s dual investigations come as part of regulator’s focus on information technology providers, especially companies that license patent technology for mobile devices and networks.
Industry experts are of the view that with such investigations NDRC, the government’s main economic planning body, is trying to lower down domestic costs as China is all set to roll out its faster 4G mobile networks this year.
The China Mobile Communications Industry Association, sometime earlier this month, announced it had filed a complaint against the U.S. chip maker for overcharging for use of its patents.
Under the anti-monopoly law, if any company is found indulging in some kind of price discrimination practices, the NDRC can levy fines of between 1 and 10 percent of that company’s revenues for the previous year. Qualcomm reportedly earned $12.3 billion in China for its fiscal year ended September 29, which means that the company could end up paying a whopping $1.2 billion if found guilty.
Christine Trimble, Qualcomm spokeswoman, said the company was cooperating with the investigation. “We haven’t seen the transcript of today’s press conference but we intend to continue cooperating fully with the NDRC”.
“The NDRC has advised us the investigation is confidential”, she added.
Qualcomm first confirmed that it was under investigation last year in November, but had revealed at the time that the “substance of the investigation is confidential”.
[Source: South China Morning Post]
