China's anti-monopoly regulator, the NDRC, could fine US chip-making giant Qualcomm more than $1 billion on charges of monopolism. The agency received reports that Qualcomm "abuses its dominant position in the market and charges discriminatory fees." In one such case, the China Mobile Communications Industry Association filed a complaint against the chip-maker for overpricing its patent licenses.
The Chinese government began investigating Qualcomm late last year, following evidence of price-fixing. Last November, it conducted raids in the company's Beijing headquarters and its Shanghai offices. The San Diego-based chip-maker has been cooperating with the investigation. Last December, Chinese officials met William Bold, Qualcomm's senior vice president for government affairs, and Fabian Gonell, vice president and counsel for technology licensing. According to spokeswoman Cheistine Trimble, the company intends to "continue cooperating fully with the NDRC". However, details about the investigation will remain confidential.
Analysts state that any possible resolution will involve Qualcomm lowering patent licensing fees for Chinese customers, and paying a fine. Under Chinese anti-monopoly law, the NDRC can confiscate between 1 to 10% of the company's revenues for the previous fiscal year.
The Chinese government's ongoing consumer protection efforts have stretched to foreign companies from all industries, including tech firm InterDigital Inc, pharmaceutical giant GlaxoSmithCline, and food maker Danone. They have all faced similar scrutiny in suspicion of anti-competitive practices.