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Photo: Korea Fair Trade Commission |
[Alpha Biz= Kim Jisun] Broadcom has agreed to stop forcing Korean set-top box manufacturers to use only its semiconductor components in their products.
On Friday, the Korea Fair Trade Commission (KFTC) announced that it had decided to initiate the consent decree process following Broadcom's application for voluntary corrective measures.
The consent decree system allows companies under investigation for potential legal violations to propose self-corrective measures. If the KFTC deems these measures appropriate, the case can be resolved without confirming any legal wrongdoing.
Broadcom, a leading provider of system-on-chip (SoC) components for pay-TV set-top boxes, had previously required Korean manufacturers to propose set-top boxes equipped exclusively with Broadcom’s chips when bidding for contracts with pay-TV operators.
In some cases, the company even pressured manufacturers to replace competitors' chips with Broadcom’s, despite prior agreements to use alternative components.
The KFTC had been investigating whether Broadcom’s actions constituted a violation of fair trade laws by restricting competition.
Before receiving the KFTC's examination report, Broadcom submitted a voluntary corrective plan, citing its intention to improve competition in the semiconductor market and support small and medium-sized enterprises.
As part of its commitments, Broadcom will no longer require Korean set-top box manufacturers to use only its components, nor will it unilaterally alter existing contract terms to the disadvantage of its business partners.
Additionally, Broadcom has pledged not to impose contractual clauses requiring customers to source more than half of their semiconductor components from Broadcom in exchange for price or non-price benefits.
To ensure compliance, Broadcom plans to implement a compliance program (CP), conduct annual training on fair trade laws for its employees, and report its adherence to these corrective measures to the KFTC each year.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
