On June 20, 2012, Google Inc. (“Google”) received unconditional clearance from the Korea Fair Trade Commission (the “KFTC”) to acquire Motorola Mobility Holdings, Inc. (“Motorola”). Shin & Kim advised Google on the Korean anti-trust aspect of this transaction.
When the transaction was first publicly announced in August, 2011, both the mobile industry and the media expressed concerns about the transaction’s potential anti-competitive effect on the market because Google, the leading developer and distributor of the Android operating system, was moving to purchase Motorola, one of the leading Android smartphone makers. The center of the concerns was that Google would potentially restrict the future availability of Android to smartphone makers (particularly, major Korean Android smartphone makers) by cutting off supplies of or charging fees for Android. In light of such concerns, it was highly anticipated that Google would face difficulties in obtaining the KFTC’s clearance for the transaction, and even if Google were to obtain the KFTC’s clearance, it would be conditional clearance. Such anticipation further grew when Google’s competitors proactively submitted their opinion letters to the KFTC, arguing against the KFTC’s approval of the transaction.
Against this background, based on the in-depth understanding of the relevant anti-trust laws and IT industry, Shin & Kim effectively persuaded the KFTC to diffuse such concerns by arguing that (i) Google’s business strategy is to drive its revenues from online advertising while maintaining and enhancing the open Android ecosystem, and thus, Google has no incentive to foreclose other mobile device makers from using Android, and (ii) the purpose of this transaction is for Google to acquire Motorola’s existing patents in order to protect the Android ecosystem from its competitors, and the transaction would rather promote competition in the market for mobile software platforms. Through such efforts, Shin & Kim’s anti-trust team guided Google to successfully obtain unconditional clearance from the KFTC for this transaction.