China investigating Qualcomm, InterDigital (Update)

February 19, 2014 by Joe Mcdonald

Regulators are investigating whether U.S. technology companies Qualcomm and InterDigital violated China's anti-monopoly law by charging excessive fees for patent licenses, a government spokesman said Wednesday.

Regulators began separate investigations of the two companies in mid-2013 following complaints, an official of the Cabinet's planning agency said at a news conference. The official, Xu Kunlin, said they were suspected of "abusing their dominant market position" and charging "discriminatorily high fees" but gave no details.

China is a major producer of mobile phones and other electronics and the communist government has complained about the high cost of licenses for foreign technology. Beijing has tried to reduce reliance on foreign know-how by investing billions of dollars to develop its own mobile phone, encryption and other technology.

Beijing is stepping up scrutiny of foreign companies under its 6-year-old anti-monopoly, anti-bribery and other laws.

In August, five foreign milk suppliers and one based in Hong Kong were fined a total of $108 million on charges of price-fixing. Employees of foreign drug companies have been accused of bribing doctors to use their products.

Qualcomm Inc., based in San Diego, California, and InterDigital Inc., in Wilmington, Delaware, have previously disclosed they were under investigation but Wednesday's comments were the first by the Chinese government.

Authorities are considering a proposal by InterDigital to resolve the investigation of that company by making changes in its business practices, according to Xu. He said the government is considering the proposal and gave no details.

The investigation of Qualcomm Inc. still is underway, Xu said.

There have been few court rulings so far on cases under the 2008 anti-monopoly law. That has fed uncertainty about how it will apply to global companies that are eager to expand in the world's second-largest economy.

Chinese regulators have cited the law in ordering changes to acquisitions or business practices. In 2009, they blocked Coca-Cola Co. from buying a Chinese fruit juice producer.

Business groups welcomed the law as a step toward clarifying operating conditions in China. Since then, they have said it is enforced more actively against foreign companies than against their Chinese rivals.

Explore further: EU drops Qualcomm antitrust probe

Related Stories

EU drops Qualcomm antitrust probe

November 24, 2009

(AP) -- European Union antitrust regulators on Tuesday dropped a monopoly abuse probe into wireless chip maker Qualcomm Inc. after mobile phone companies withdrew complaints about high royalty fees.

China probes telecom giants for internet monopoly

November 9, 2011

A Chinese government agency is investigating two telecommunications giants for allegedly monopolising Internet broadband services, state media said Wednesday, in an unusual public spat.

Recommended for you

The ethics of robot love

November 25, 2015

There was to have been a conference in Malaysia last week called Love and Sex with Robots but it was cancelled. Malaysian police branded it "illegal" and "ridiculous". "There is nothing scientific about sex with robots," ...

Nevada researchers trying to turn roadside weed into biofuel

November 26, 2015

Three decades ago, a University of Nevada researcher who obtained one of the first U.S. Energy Department grants to study the potential to turn plants into biofuels became convinced that a roadside weed—curly top gumweed—was ...


Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.