Qualcomm agrees $975m China anti-trust settlement

Firm ends patent dispute with hefty payment and changes to royalty charges

Qualcomm has agreed to pay $975m to settle an anti-trust dispute in China, the largest such fine in Chinese corporate history.

The settlement has been struck with China's National Development and Reform Commission (NDRC), which was investigating the firm over suspicions that it holds a monopoly in the Chinese telecoms market.

It believed that Qualcomm's China subsidiary was overcharging and exploiting its position in the wireless communications standards sector.

Qualcomm has now agreed a settlement with the NDRC which includes paying the $975m fee.

Qualcomm will also offer 3G and 4G patents as independent licences, rather than alongside other patents, and charge royalties based on 65 percent of a phone's selling price, not 100 percent.

Announcing the deal, Qualcomm chief executive Steve Mollenkopf said that the company is pleased to reach a resolution and end the uncertainty.

"Qualcomm has played an important role in the success of the mobile and semiconductor industries in China for many years, and we look forward to building on this foundation as we grow our investments, engagement and business in China," he said.

"We are pleased that the resolution has removed the uncertainty surrounding our business in China, and we will now focus our full attention and resources on supporting our customers and partners in China and pursuing the many opportunities ahead."

Qualcomm still faces a possible anti-trust challenge in Europe, after a complaint by British software-defined modem company Icera, a subsidiary of Nvidia Corp.

Icera has alleged that Qualcomm engaged in anti-competitive behaviour by discouraging customers from doing business with Icera through patent-related incentives and exclusionary pricing of chipsets.

Qualcomm is also having to deal with claims that its newest Snapdragon processor has overheating problems that forced Samsung to drop the chip from the forthcoming Galaxy S6.