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Qualcomm (QCOM) Stock Hammered, South Korea Alleges Illegal Patent Licensing Practices

NEW YORK (TheStreet) -- Qualcomm (QCOM - Get Report) stock is getting hammered, down 8.74% to $48.35 on Wednesday as South Korea's antitrust agency is accusing the chip maker for allegedly violating local competition law.

South Korea's Fair Trade Commission sent an "examiner's report" to Qualcomm, alleging that the company does not properly negotiate aspects of its licences and that it improperly maintains both chip and intellectual property licenses, Barron' reports.

Consequently, Qualcomm should be fined, regulators said.

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The chip giant refuted these claims stating, "The allegations and conclusions contained in the examiner's report are not supported by the facts and are a serious misapplication of law."

This action comes as Qualcomm has a significant market power in South Korea. The country is the home to smartphone giants Samsung Electronics (SSNLF), LG Electronics and Pantech, which are all of Qualcomm's clients, reports.

Regarding these allegations, Bernstein Research analysts said "The Case Examiner's report sheds some troubling light on the details of the...