telecommunications industries, where standard-setting activity has been the most active, of which the
most high-profile example so far was the so-called “smartphone patent wars”between various smart-
phone manufacturers and technology firms.
South Korea has also been intimately involved in these debates due to a combination of an active
competition agency, the Korea Fair Trade Commission (KFTC), and being home to major industrial
players involved at multiple levels of the telecommunications technology value chain. While the recent
smartphone patent wars have led to the formation of a nascent consensus on some of the basic
questions raised by SEPs, many other issues are still very contentious, and Korea appears to have
recently reinserted itself squarely in the middle of the ongoing debate with the KFTC’s recent
announcement of its decision in its second major investigation of Qualcomm Incorporated and its
affiliates (Qualcomm), initiated in August 2014 (Qualcomm 2).
The KFTC as the primary competition law enforcement agency in Korea is responsible for over-
seeing and enforcing a broad spectrum of laws and regulations encompassing not only competition law
and fair trade, but also consumer protect ion, franchising, e-commerce, corpo rate governance and
disclosure, distribution, labeling and advertising, subcontracting relations, contracts of adhesion, multi-
level marketing, and more. The key legislation, however, is the Monopoly Regulation and Fair Trade
Act (MRFTA), which was first enacted as of December 31, 1980, came into force as of April 1, 1981,
and was most recently amended as of April 18, 2017.
Together with the rapid technological advancement of the Korean economy and Korean firms’
engagement with and integration into the global economy, the KFTC has shown a willingness to take
on contentious antitrust issues against some of the largest multinationals in the world with its inves-
tigations against companies such as Microsoft, Intel, Qualcomm, Google, Oracle, and Apple (to name
just a few) and in the process has acquired a reputation as an active, even aggressive enforcer. In
particular, the KFTC has recently begun to focus on the possibility that certain unfair exercise of
intellectual property rights (IPR) could constitute a violation of the MRFTA and that interest has
encompassed the exercise of SEPs.
An important aspect of the MRFTA that cannot be overlooked in the context of IPR abuse is the
MRFTA’s recognition of exploitative, in addition to exclusionary, harm as a competitive concern.
While the KFTC has been reluctant to directly apply the MRFTA’s“price abuse”provisions and
increasingly tends to focus on exclusionary harm in its enforcement priorities, the historical acceptance
of exploitative harm as a competitive concern in Korea may nevertheless influence the KFTC’s
approach to alleged abusive conduct by holders of patents and SEPs, including alleged breaches of
FRAND, which has brought the dimension of exploitative harm into the debate (in the form of the
theory of patent “holdup”
) even in jurisdictions such as the U.S.
1. SEPs burst into the South Korean public consciousness with a U.S. jury’s award of 1.049 billion U.S. dollars to Apple Inc.
(Apple) on August 24, 2012, in its patent infringement case against Samsung Electronics Co., Ltd. (Samsung) and two of its
U.S. affiliates, and Samsung’s subsequent assertion of its telecommunications-related SEPs against Apple in worldwide
2. Dokjeomgyujemitgongjeonggeoraeaegwanhanbeobryul [Monopoly Regulation and Fair Trade Act], Act. No. 14813, April
18, 2017 (S. Kor.) (hereinafter MRFTA).
3. For example, the KFTC’s most recent Annual Workplan for 2017 states that it will closely review representative abusive
conduct through the acquisition of standard technologies such as unfair injunction claims in breach of FRAND commitments,
tying of services and products not directly related to standard technology, etc. that leads to exclusion of competitors or
lessening of R&D innovation competition. See Press Release, Korea Fair Trade Commission, 2017 nyeongongjeong
wieopmoogyehwek [2017 Korea Fair Trade Commission Work Plan] (Jan. 5, 2017), http://www.ftc.go.kr/news/ftc/repo
4. Mark A. Lemley& Carl Shapiro, Patent Holdup and Royalty Stacking,85T
EX.L.REV. 1991 (2007).
466 The Antitrust Bulletin 62(3)