Japan FTC Says Qualcomm Violated Antimonopoly Act

Qualcomm coerced Japanese telecom equipment makers into signing licenses that impede the companies in their research and development efforts and strengthen its own position in the Japanese market, the country's Fair Trade Commission said Wednesday.

The company was found in violation of Japan's Antimonopoly Act and was ordered on Monday to rescind certain provisions on the licenses issued to Japanese companies, the Japan Fair Trade Commission (JFTC) said.

Qualcomm owns many basic patents related to CDMA (Code Division Multiple Access) technology that are used in the WCDMA (Wideband CDMA) cellular telephone standard used for 3G services in Japan and most other countries. Before manufacturing phones, base stations or other cellular equipment Japanese companies must conclude a license agreement with Qualcomm.

Some of the Japanese companies also own intellectual property related to CDMA and the licensees issued by Qualcomm required the Japanese companies give Qualcomm access to some of their technology on a royalty-free basis. The licenses also required Japanese manufacturers to agree not to sue Qualcomm or its licensees, said the JFTC.

The licenses were issued despite Qualcomm expressing earlier that it would offer CDMA intellectual property under reasonable terms and conditions on a nonexclusive and nondiscriminatory basis, the JFTC said.

"This tends to impede the Japanese manufacturers' incentive to engage in research and development pertaining to technologies related to CDMA subscriber units, CDMA base stations and semiconductor integrated circuits used therein and tend to further strengthen Qualcomm's influential position in the market pertaining to the technologies, thereby tending to impede fair competition in the technology market," the JFTC said in its ruling.

Qualcomm in Tokyo could not immediately be reached for comment.

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