China's antitrust regulator has accused chipmaker Qualcomm of abusing its market dominance and overcharging customers, charges that could see the firm hit with record fines of millions of dollars.
The National Development and Reform Commission (NDRC) said that it started an investigation into the company last year after complaints from Chinese industrial associations and lawyers, state news agency Xinhua reported.
The complaints were connected to Qualcomm's dominance in wireless telecoms patents and mobile phone chips and claimed that the company issued unfair and discriminatory prices with unreasonable conditions, the NDRC explained.
The regulator's probe of Qualcomm is part of a raft of investigations into firms that work in the mobile industry. Some commentators claim that China is trying to lower costs ahead of the rollout of its 4G networks. But the NDRC said that the case was "just a routine part of our work to maintain market order".
It also said that its preliminary investigation had shown the anticompetitive allegations were "well-founded".
Under Chinese anti-monopoly laws, the NDRC can impose fines of between one and 10 per cent of a company's previous yearly revenue. Qualcomm made $12.3bn in China in the fiscal year to September, which could mean a potential fine as much as $1bn.
Qualcomm had not returned a request for comment at the time of publication. ®