South Korea’s Supreme Court has finalized an antitrust fine of 18.664 billion won — roughly $13.8 to $13.9 million depending on the exchange rate used — against U.S. chipmaker Broadcom, closing out a years-long dispute over how the company treated Samsung Electronics in a component supply deal, according to Yonhap, The Korea Herald, The Korea Times and BusinessKorea.
- South Korea's Supreme Court dismissed Broadcom's appeal on Oct. 27, finalizing an 18.664 billion won fine ($13.8–13.9 million, depending on exchange rate used), according to Yonhap, The Korea Herald and The Korea Times.
- The Korea Fair Trade Commission (FTC) first imposed the penalty in September 2023 for Broadcom's conduct toward Samsung Electronics, per BusinessKorea.
- In 2020, Broadcom reportedly demanded Samsung commit to buying at least $760 million worth of components annually for three years starting in 2021, with Samsung required to cover any shortfall, according to all four outlets.
- The FTC found Broadcom halted purchase-order approvals, shipments, production and technical support when Samsung resisted the terms, per BusinessKorea.
- The Seoul High Court had already ruled against Broadcom in May before the case reached the Supreme Court, according to Yonhap and The Korea Times.
What happened
The Supreme Court’s First Petty Bench, presided over by Justice Cheon Dae-yeop, dismissed an appeal filed by Broadcom’s U.S. headquarters and affiliated companies, according to BusinessKorea. The ruling, issued Oct. 27 and confirmed by legal sources in the following days, finalizes a Seoul High Court decision from May that had already sided with Korea’s Fair Trade Commission (FTC), as reported by Yonhap and The Korea Times.
The case traces back to a contract Samsung signed with Broadcom in March 2020. Under the deal, Samsung committed to purchasing at least $760 million worth of Broadcom components annually for three years starting in 2021, with a clause requiring Samsung to pay the difference if actual purchases fell short, according to all four outlets.
BusinessKorea reported that Samsung only agreed to these terms after Broadcom suspended approval of purchase orders and halted shipments, production, and some technical support — actions the FTC said were designed to force Samsung’s hand. Samsung reportedly feared disruptions to its smartphone production if it did not comply.
Why it matters
The FTC concluded that Broadcom’s tactics restricted Samsung’s ability to choose alternative suppliers and blocked rivals from competing for the business, according to BusinessKorea. The regulator estimated that the restrictions cost Samsung at least $160 million in additional expenses based on exchange rates at the time.
Our read: the ruling signals that Korea’s antitrust enforcement extends firmly to foreign suppliers dealing with domestic manufacturers, even when the supplier holds significant leverage over a critical part of the supply chain. For global chip companies operating in Korea, the case underscores that aggressive supply-chain tactics can draw regulatory scrutiny and costly, multi-year legal battles.
Background
The FTC first imposed the corrective order and penalty surcharge on Broadcom in September 2023, according to BusinessKorea. Broadcom challenged the decision in a lawsuit filed in November 2023, per The Korea Times and Yonhap. The case proceeded through Korea’s standard appeals process: an FTC decision, once contested, goes to the Seoul High Court, with further appeals possible to the Supreme Court, as Yonhap noted.
The Seoul High Court sided with the FTC in May, finding the fine justified, according to Yonhap. It also reportedly determined that Broadcom used unusual means — namely the unilateral halt on parts supply — to compel Samsung into a contract whose terms were disadvantageous to the Korean company, per BusinessKorea.
What to watch
With the Supreme Court’s dismissal, the FTC’s fine and corrective order against Broadcom are now final, closing this particular chapter of the dispute. The case may factor into how other multinational suppliers structure long-term contracts with Korean manufacturers going forward, particularly around exclusivity and minimum-purchase clauses.
It also reflects a broader pattern of Korean regulators scrutinizing the bargaining practices of dominant global tech and component suppliers. How Broadcom adjusts its commercial relationships with Samsung and other Korean partners in light of this outcome remains to be seen.
Frequently asked questions
How much was Broadcom fined?
The Korea Fair Trade Commission fined Broadcom 18.664 billion won, reported as roughly $13.8 to $13.9 million depending on the exchange rate cited by different outlets.
What did Broadcom do to Samsung?
According to BusinessKorea, Broadcom pressured Samsung into a 2020 long-term supply contract by suspending purchase-order approvals, shipments and technical support, pushing Samsung to commit to buying at least $760 million in parts annually for three years.
What did the Supreme Court decide?
The Supreme Court's First Petty Bench, led by Justice Cheon Dae-yeop, dismissed Broadcom's appeal on Oct. 27, confirming the Seoul High Court's earlier ruling that upheld the FTC's penalty, per BusinessKorea and Yonhap.
Sources
- BusinessKorea: Broadcom Loses Supreme Court Appeal with Pressure on Samsung
- The Korea Herald: Korea's top court upholds W18.6b fine on Broadcom for pressuring Samsung into unfair deal
- The Korea Times: Top court upholds antitrust watchdog's $13.8 mil. fine on Broadcom
- Yonhap News: Top court upholds antitrust watchdog's 18.6 bln-won fine on Broadcom
This article was prepared with AI assistance from the reports listed above and automatically checked against them. See About for how we work.