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Update: Treasury alleges Broadcom defied order in timely notice of US return

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Update: Treasury alleges Broadcom defied order in timely notice of US return

The U.S. Treasury Department said Broadcom Ltd. violated the department's order by failing to provide sufficient notice to a national security panel of its plan to move its headquarters back to the U.S., Reuters reported.

The Singapore-based chipmaker earlier announced that it expects to complete the move by April 3, earlier than the previously reported May 6, amid a national security review of its $117 billion bid for QUALCOMM Inc.

Aimen Mir, a top official of the Committee on Foreign Investment in the U.S., or CFIUS, reportedly said in a letter to Broadcom dated March 11 that the chipmaker "took a series of actions in violation" of the Treasury Department's March 5 order which requires Broadcom to notify CFIUS of any action it takes toward moving back to the U.S.

The letter, made public by Qualcomm, reportedly said Broadcom took three such actions without giving proper notice to CFIUS, which included working with a Singapore court to accelerate the process of redomiciling.

Broadcom denied the department's allegations, according to Reuters. "Given Broadcom’s public disclosures about the redomiciliation process since last November, as well as its direct communications to CFIUS, Broadcom has been fully transparent with CFIUS about the redomiciliation process, and believes it is in full compliance with the March 4 interim order," Broadcom reportedly said.

The letter further said that CFIUS' investigation has so far confirmed the national security concerns. "In the absence of information that changes CFIUS' assessment of the national security risks posed by this transaction, CFIUS would consider taking further action, including but not limited to referring the transaction to the president for decision."

CFIUS, in early March, ordered Qualcomm to postpone its annual shareholder meeting by 30 days as the inter-agency panel seeks to assess whether a takeover by Broadcom would pose a national security risk.

Broadcom, in its statement regarding redomiciliation, said the national security concerns are not a risk to closing the proposed bid, as it never planned to acquire the U.S. chipmaker before it completes its relocation.

"Broadcom, which is in all important respects a U.S. company, has been repeatedly approved by CFIUS in its previous acquisitions of U.S. companies and has always engaged productively with CFIUS to ensure U.S. national security is protected," Broadcom said. "Broadcom believes the CFIUS process is an essential aspect of protecting U.S. national security."

The expected redomiciliation will be completed just a few days before Qualcomm conducts its annual shareholder meeting in April. Broadcom was based in the U.S. until 2016 when it was incorporated in Singapore after it was acquired by Avago.