BEIJING--China's Ministry of Commerce has conditionally approved
the formation of a joint venture that will provide software that
will be closely integrated with ARM-based chips, enabling more
secure payments over mobile phones and other enhanced security for
mobile devices.
The joint-venture company, announced in April, is between U.K.
semiconductor design company ARM Holdings PLC (ARMH),
Amsterdam-based digital-security company Gemalto NV (GTOMY) and
Munich-based technology company Giesecke & Devrient GmbH.
The commerce ministry expressed concern in a statement Thursday
that the move could hinder competition in mobile security
technologies, echoing similar concerns voiced by European antitrust
authorities, which last month also approved the joint venture with
conditions attached.
To address these concerns, the ministry has ordered ARM to
release information to competitors on its TrustZone security
technology, enabling them to develop their own security
solutions.
In addition, ARM must not reduce the efficiency of competitors'
security offerings through its own designs and patents, the
ministry said.
ARM must comply with the conditions for a period of eight years,
the statement said.
The conditions are similar to those imposed by the European
Commission last month. China's Ministry of Commerce has a history
of frequently mirroring the recommendations of foreign antitrust
authorities in cases involving foreign companies.
Under China's antitrust law, instituted in 2008, the ministry
has the authority to approve mergers and acquisitions of foreign
companies that have significant market share in China.
Write to Liyan Qi at liyan.qi@dowjones.com and Aaron Back at
aaron.back@dowjones.com
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