Qualcomm, Taiwan Competition Commission Reach Settlement

Qualcomm and Taiwan Fair Trade Commission (TFTC) have finally reached a settlement in a matter where the US chip maker was alleged violated business practices in the country. The chip maker now agreed to make some changes in its licensing terms and invest in the country to reach the settlement.

As part of the resolution, Qualcomm has agreed to certain process-related commitments confirming principles of mutual good-faith and fairness in the negotiation of agreements with handset licensees to Qualcomm’s cellular standard essential patents (SEPs). The resolution does not require component-level licensing or set specific financial terms; instead it is focused on commitments that ensure good-faith negotiations for the benefit of licensees and SEP owners.

Also, the fine initially imposed by the TFTC, of around $773 million, has been drastically reduced. However, the penalty that Qualcomm had already paid to the commission – $93 million – will be retained by TFTC and no further amounts will be due, the chip maker said in a statement.

In addition, Qualcomm will drive certain commercial initiatives in Taiwan over the next five years for the benefit of the mobile and semiconductor ecosystem, SMEs and consumers, including 5G collaborations, new market expansion, start-up and university collaborations and the development of a Taiwanese center for operations and manufacturing engineering. Qualcomm will work with the TFTC and sister agencies within the Taiwanese government to implement these initiatives and investments.

“We are pleased to have reached a mutually beneficial resolution with the TFTC that puts the litigation behind us,” said Alex Rogers, executive vice president and president, Qualcomm Technology Licensing. “This settlement directly addresses concerns raised by the TFTC, regardless of disputed positions, and builds on our foundation of collaborative, long-term business relationships in Taiwan. We are happy to reaffirm our commitment to licensing our valuable intellectual property under principles of fairness and good faith. With the uncertainty removed, we can now focus on expanding our relationships that support the Taiwanese wireless industry and rapid adoption of 5G technology.”

This development came after close to a year since the last hearing when Qualcomm was accused of violating business practices in the country. TFTC had imposed a fine of $773 million on the chip maker in October 2017.

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