Dolby under probe from Korea’s antitrust agency

FTC Chairman Kim Sang-jo

South Korea’s antitrust watchdog has launched a full-scale probe into U.S. audio giant Dolby Laboratories on accusations that it has abused its market position to pocket unfairly high royalties.

The Fair Trade Commission (FTC) has already conducted an on-site inspection on Dolby, said FTC Chairman Kim Sang-jo at a parliamentary audit session on Monday.

Dolby, which licenses its standard audio technologies to electronics makers, is charged of extorting royalties of up to 20 times the standard level.

“We’ve embarked on a detailed probe into Dolby’s patent commission and penalty terms and are closely looking into other matters as well,” said Kim.

When asked about compensation for the partner companies, Kim said the FTC can only issue an order requiring Dolby to cough up any unpaid fees it owes to contractors. The commission would instead support the civil claims for damages by conducting a thorough investigation, he added.

The FTC chief said inspections are also underway for the Korean units of Google and Agoda, the hotel reservation service provider. Google Korea is suspected of forcing local game companies to launch their games exclusively on Google Play, the company’s official app store. Agoda faces criticism of failing to properly fix its problematic no-refund policy.

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