South Korea’s Supreme Court Upholds $13.8M Broadcom Fine Over Samsung Deal

The ruling leaves intact sanctions imposed by the Korea Fair Trade Commission in 2023 after the regulator determined that Broadcom had exploited its commercial relationship with Samsung to secure unfavorable contractual terms, according to a report published Monday by The Korea Times.

The dispute centers on an agreement reached in 2020 that obligated Samsung to purchase at least $760 million in smartphone components from Broadcom annually between 2021 and 2023. Under the arrangement, Samsung was also required to compensate the U.S. supplier if its purchases failed to meet the minimum annual commitment.

South Korean competition authorities concluded that the conditions reflected an abuse of Broadcom’s stronger negotiating position rather than an agreement reached through ordinary commercial bargaining, according to The Korea Times.

The Supreme Court rejected Broadcom’s challenge to an earlier Seoul High Court decision that had supported the regulator’s findings and upheld the financial penalty.

The decision, issued Oct. 27 and reported Nov. 2, concludes Broadcom’s effort to overturn the sanctions through South Korea’s judicial system, according to additional reporting by Yonhap News Agency.

Supply Agreement at Center of Dispute

The case highlights the commercial risks facing electronics manufacturers that depend on specialized semiconductor suppliers for components essential to their products.

According to The Korea Times, South Korea’s antitrust authority determined that Broadcom had used its position as a major component supplier to compel Samsung to accept a multiyear purchasing commitment.

The agreement required Samsung to maintain substantial annual purchases regardless of whether its actual component requirements reached the contractual threshold.

Related: South Korea Fines Samsung $15M Over Galaxy Gaming

The regulator imposed the penalty in 2023, finding that the arrangement violated South Korean competition rules governing unfair business practices.

Additional reporting by The Korea Herald said regulators found that Broadcom had pressured Samsung by withholding purchase-order approvals and threatening disruptions to component deliveries. The disputed products included radio-frequency components and wireless connectivity chips used in smartphones.

The potential interruption of essential semiconductor supplies placed Samsung in a difficult negotiating position, particularly as the company sought to maintain smartphone production.

Broadcom’s Legal Challenge Fails

Broadcom contested the competition authority’s decision in November 2023, seeking to invalidate the sanctions through the courts.

The Seoul High Court ruled against the company in May 2026, determining that the regulator had sufficient grounds to impose the penalty, according to Yonhap’s reporting carried by The Korea Times.

Broadcom subsequently appealed to the Supreme Court, which upheld the lower court’s decision.

The outcome confirms the enforceability of the antitrust penalty and ends the judicial challenge to the regulator’s original action.

Under South Korea’s competition enforcement system, companies can challenge decisions by the Fair Trade Commission before the Seoul High Court and pursue a final appeal before the Supreme Court.

Source: The Korea Times