FTC rejects Broadcom's $15 million proposal to correct unfair practices

The Broadcom Limited company logo is shown outside one of their office complexes in Irvine, California, on March 4, 2021. [REUTERS]

Korea's antitrust agency Tuesday rejected corrective measures Broadcom proposed to address the abuse of its dominant market power that it committed against Samsung Electronics.

The San Jose, California-based tech giant enforced an unfair long-term agreement that obligated Samsung Electronics to buy $760 million worth of chips from Broadcom from 2021 to 2023, according to the Fair Trade Commission (FTC).

The contract also required Samsung Electronics to compensate for any shortfall if it failed to purchase the stated amount.

In response to the investigation launched by the FTC, Broadcom in January proposed to create a 20-billion-won ($15 million) funding project for local tech companies as well as technical and quality assurance assistance for Samsung Electronics.

However, Samsung Electronics and other Korean electronics companies submitted a letter to the FTC to call on the regulator to compel Broadcom to reimburse damages in full.

Korean media outlets estimated Samsung Electronics' damages at 100 billion won at minimum.

Samsung Electronics declined to comment on the ongoing dispute with Broadcom.

The FTC will continue the deliberation process to determine the penalties against Broadcom.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]