America’s telecommunication equipment company Qualcomm has been hit with a $774 million fine by Taiwan for antitrust violations.
On Wednesday, the Taiwan Fair Trade Commission (FTC) said it would fine Qualcomm $774.14 million. The commission accused Qualcomm of abusing its monopoly over smartphone modems to squeeze higher licensing fees and better terms out of its customers.
This is the commission’s highest ever fine since its genesis in 1992.
The commission said that Qualcomm’s dominance in CDMA and LTE chips, let the company abuse its position. The company either refuses to license the tech to rival chipmakers or charges them with unfavorable fees.
Qualcomm is ordered to end its improper practices and the unfavorable deals it made with other companies, at once.
Qualcomm denied the charge and said that it will appeal both the ruling and the heavy fine.
“The fine bears no rational relationship to the amount of Qualcomm’s revenues or activities in Taiwan, and Qualcomm will appeal the amount of the fine and the method used to calculate it”, stated the company.
Last year, 12% of Qualcomm’s earnings ($2.8 billion) came from Taiwan. The Taiwanese FTC claims that the chipmaker company has been violating antitrust laws for at least “seven years”.
Taiwan is not the only country to go after them, last December South Korea fined it $854 million for violating its competition laws. The company continues to appeal the fine.
China fined Qualcomm $975 million in 2015 for similar charges.
With all these fines including the latest one by Taiwan, the company has been fined nearly $2.7 billion in just two years. Equivalent to nearly 12% of its projected revenues for the current year.
The company is also facing ongoing antitrust investigations in the US and Europe.
Qualcomm, famous for its Snapdragon processor line, which powers major android phones, is going through hard times as different companies and governments have decided to take a stand against its inappropriate licensing practices.
The chances of winning the appeal in South Korea and Taiwan are extremely low for Qualcomm. The only solution left for the chipmaker is to pay all these fines, agree to the terms and conditions set by the commissions and offer a clear image of its future to the investors.