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Qualcomm sues Apple manufacturers; China bans 10 live-streaming services

In this biweekly Asia-Pacific Regulatory Spotlight feature, S&P Global Market Intelligence provides a roundup of significant recent regulatory events in the region.

TOP NEWS

* Qualcomm Inc. has intensified its legal battle with Apple Inc. as it filed a lawsuit against four of the iPhone maker's Taiwan-based contract manufacturers. Qualcomm said May 17 that it is suing Hon Hai Precision Industry Co. Ltd., also known as Foxconn, and its subsidiary FIH Mobile Ltd, together with Compal Electronics, Inc., Wistron Corp. and Pegatron Corp. for breaching their license agreements by refusing to pay royalties for Qualcomm's licensed technologies.

* In its latest crackdown against online broadcasters that stream illegal content, China has shut down 10 live-streaming platforms and fined 48 companies, The Associated Press reported May 24. Authorities also closed more than 30,000 studios and terminated 547 broadcasting contracts, according to the report.

* Western Digital Corp. has taken its dispute with Toshiba Corp. to the International Court of Arbitration in a bid to prevent the latter from selling its chip business without its consent, Reuters reported May 15. Western Digital wants the Japanese company to reverse its move to spin out its joint venture assets into an affiliate with the intention of selling it, as well as to stop its all-out sale without consent from the U.S. storage technology group's SanDisk unit.

* India is letting Apple Inc. import smartphone components that will be used in local manufacturing free of tax, Reuters reported May 23, citing a government official. The tax concession was offered on components that could not be manufactured locally, Aruna Sundararajan, secretary of the Ministry of Electronics and IT, reportedly said. The tech giant, which is looking to expand its contract manufacturer's facility in Bangalore, India, has agreed to increase the local share of production over a period of time.

JAPAN AND SOUTH KOREA

* Former South Korean president Park Geun-hye appeared at the second hearing in the Seoul Central District Court on May 25, where she denied all the charges brought against her, Yonhap News Agency reported May 25. The court will start witness examination regarding Samsung's bribery case from May 29 and investigate the trial records of the conglomerate's Vice President Lee Jae-yong on June 1.

* The Korea Communications Commission is investigating the allegation that Facebook has limited the speed of access to Facebook and Instagram Inc. by users of certain domestic telecom companies, Joongang Ilbo reported May 22.

* South Korea's Ministry of Employment and Labor issued a correction order to Netmarble Games Corp. after reviewing the company and its 12 affiliates, Dong-A Ilbo reported May 21. According to the government review, 63.3% of the employees worked six additional hours per week, and overdue wages stood at 4.4 billion South Korean won in total.

* U.S.-based video game developer ZeniMax Media Inc. filed a lawsuit against Samsung Group unit Samsung Electronics Co. Ltd. The suit alleges that Samsung's VR headset, Gear VR, which was co-developed with Facebook Inc.-owned Oculus VR, Inc., infringes ZeniMax's intellectual property.

CHINA, HONG KONG AND TAIWAN

* In the latest showdown between Uber Technologies Inc. and Hong Kong authorities, 21 Uber drivers were arrested May 22 for driving without the necessary permits and third-party insurance, Reuters reported May 23.

* The Ministry of Industry and Information Technology of China on May 23 announced plans to monitor the production and usage of drones in the country. Starting this year, drone manufacturers are required to file their company and product information with relevant government bodies.

* The Cyberspace Administration of China laid out more details of the new rules on publishing news and information on the internet, Xinhua News reported May 22. Licenses must be acquired before distributing news and information through websites, applications, blogs and instant messaging, and the management system within the organization would be reviewed for licensing purposes.

* Chinese ride-hailing company Didi Chuxing obtained an official car-hailing licensing from the Beijing government, according to China Daily May 20. In December 2016, Beijing issued new rules for ride-hailing services, requiring platforms to be licensed and allowing only local drivers to operate in the city. The regulations, which had a transition period of five months, were fully implemented on May 20.

SOUTHEAST ASIA

* Google Inc. will cooperate with the Vietnamese government in removing "toxic" and illegal information on its platform, Reuters reported May 26. Parent company Alphabet Inc. reportedly made the assurance when its Chairman Eric Schmidt met with Vietnamese Prime Minister Nguyen Xuan Phuc in Hanoi on May 26.

* Thailand's newly amended Computer Crime Act, effective as of May 24, will exempt internet service providers and social media sites from criminal liability for hosting illegal content, the Bangkok Post reported May 24.

* Thailand's National Broadcasting and Telecommunications Commission (NBTC) issued a network code to the MCOT public broadcasting company to launch a subscription TV service on the 2600MHz spectrum, Prachachat reported May 24. The TV service will use 20MHz of the total spectrum and will be broadcast using broadband wireless access technology.

* The NBTC confirmed that it has no plans to shut down Facebook Inc. over its hosting of illicit content critical of the Thai monarchy, Voice TV reported May 23. Speaking to the Asia Internet Coalition — members of which include Facebook, Alphabet Inc.'s Google Inc., Apple Inc. and Twitter Inc. — the NBTC's secretary-general said that Thailand asks only for cooperation in removing content already deemed illegal by the Thai courts.

* Singapore's Minister for Communications and Information Yaacob Ibrahim has announced that the Infocomm Media Development Authority will waive frequency fees for 5G mobile network trials with immediate effect, news site Channel News Asia reported May 23. The aim of this waiver is to spur innovation and to provide support for emerging technologies, including internet of things, in Singapore.

* Indonesia's Ministry of Communication and Informatics will standardize the implementation of smart city systems in all of Indonesia, news site Tribun Makassar reported May 22.

* Thailand's Central Investigation Bureau said it will prosecute netizens for viewing online content deemed critical of the Thai monarchy, the Bangkok Post reported May 21. The CIB confirmed that viewing alone is enough to warrant prosecution.

* Thailand's NBTC said it will cooperate with European observers in its drafting of new legislation to regulate over-the-top content on platforms such as YouTube Inc. and Facebook, Thai Rath reported May 18.

* Red Granite Pictures, producer of "The Wolf of Wall Street," is in discussions with the U.S. Justice Department for the settlement of a lawsuit claiming that the film was financed by money stolen from Malaysian sovereign wealth fund 1Malaysia Development Bhd. Lawyers for the production company asked a federal judge in Los Angeles for a deadline extension to "focus on their ongoing negotiations," Bloomberg News reported May 18.

AUSTRALIA AND NEW ZEALAND

* The Australian government will be splitting the chair and chief executive roles at the Australian Communications and Media Authority, in an effort to improve transparency and accountability at the nation's media watchdog, The Australian reported May 22. The recruitment process for a permanent chair is set to start this week.

* SKY Network Television Ltd and Vodafone NZ, in their appeal to the High Court of New Zealand against the Commerce Commission's rejection of their proposed merger, argued that the regulator didn't place sufficient weight on the positive effects of the merger and that it failed to critically evaluate the evidence, Scoop News reported May 18.

INDIA AND SOUTH ASIA

* The Pakistani government is reducing withholding taxes and federal excise duty on mobile phone subscribers and telecom services, according to the proposed budget for the year 2017 to 2018, Propakistani reported May 26.

* The Competition Commission of India has given its go-ahead for Tata Group's proposed buyout of Nippon Telegraph and Telephone Corp. unit NTT DOCOMO's 21.6% stake in Tata Teleservices Limited, The Economic Times (India) reported May 25.

* The Nepal Telecommunications Authority has granted a 4G license to Smart Telecom, allowing the local telco to launch 4G services in the country starting July 30, The Himalayan Times reported May 25. Smart Telecom becomes the third operator to receive a 4G license after Nepal Telecom and Ncell.

* The Indian government will look into the proposal to penalize Bharti Airtel Ltd., Vodafone Group Plc's Vodafone India and Idea Cellular Ltd for not providing adequate points of interconnection to newcomer Reliance Jio, IANS reported May 25. The telecom regulator has put a penalty of 30.50 billion rupees collectively on these three telecom operators.