Qualcomm 2012 Annual Report Download - page 28

these foreign subsidiaries. Our future financial results and liquidity may be adversely affected if tax rules regarding unrepatriated earnings
change, if domestic cash needs require us to repatriate foreign earnings, or if the United States international tax rules change as part of
comprehensive tax reform or other tax legislation.
If wireless devices pose safety risks, we may be subject to new regulations, and demand for our products and those of our customers and
licensees may decrease.
Concerns over the effects of radio frequency emissions continue. Interest groups have requested that the FCC investigate claims that wireless
communications technologies pose health concerns and cause interference with, among other things, airbags, hearing aids and medical devices.
Legislation that may be adopted in response to these concerns or adverse news or findings about safety risks could reduce demand for our
products and those of our licensees and customers in the United States as well as in foreign countries.
We are subject to government regulations. Our business may suffer as a result of changes in laws or regulations, our failure or inability to
comply with laws or regulations or adverse rulings in enforcement or other proceedings.
Our products and services, and those of our customers and licensees, are subject to various laws and regulations globally, as well as the
specifications of international, national and regional communications standards bodies. The adoption of new laws or regulations or changes in
the regulation of our activities by a government or standards body, including, among others, those affecting the use of our technology or
products, trade, foreign investments, licensing practices, spectrum availability and license issuance, adoption of standards, the provision of
device subsidies by wireless operators to their customers, taxation, environmental protection, loans and employment, could have an adverse
effect on our business.
National, state and local environmental laws and regulations affect our operations around the world. These laws may make it more expensive
to manufacture, have manufactured and sell products. Our costs could also increase if our vendors (e.g., third-party manufacturers or utility
companies) pass on their costs to us. It may also be difficult to comply with laws and regulations in a timely manner, and we may not have
compliant products available in the quantities requested by our customers, which may have an adverse impact on our results of operations.
One of our subsidiaries in India holds broadband wireless access (BWA) spectrum that will be used to operate a wireless network. Bharti
Airtel Limited (Bharti), an Indian wireless network operator, holds a 49% interest in this and other subsidiaries formed to operate the wireless
network (the BWA subsidiaries). Our license to use the BWA spectrum is subject to minimum build-out requirements to be met within 5 years,
by May 2017. If we do not meet these requirements, the Government of India’
s Department of Telecommunications could impose a fine or could
rescind the license in the area(s) in which the build-out requirements are not met. There are also other contingencies, including unexpected
regulatory delays or conditions, which could adversely impact our ability to successfully and timely exit the BWA subsidiaries as anticipated.
The SEC has recently adopted disclosure rules for companies that use conflict minerals in their products, with substantial supply chain
verification requirements in the event that the materials come from, or could have come from, the Democratic Republic of the Congo or
adjoining countries. These new rules and verification requirements, which will apply to our activities in calendar 2013, will impose additional
costs on us and on our suppliers, and may limit the sources or increase the prices of materials used in our products. Further, if we are unable to
certify that our products are conflict free, we may face challenges with our customers, which could place us at a competitive disadvantage, and
our reputation may be harmed.
Laws, regulations and standards relating to corporate governance, business conduct, public disclosure and health care are complex and
changing and may create uncertainty regarding compliance. Laws, regulations and standards are subject to varying interpretations in many cases,
and their application in practice may evolve over time. As a result, our efforts to comply may fail, particularly if there is ambiguity as to how
they should be applied in practice. New laws, regulations and standards or evolving interpretations of legal requirements may cause us to incur
higher costs as we revise current practices, policies and/or procedures and may divert management time and attention to compliance activities.
We may not be able to attract and retain qualified employees.
Our future success depends largely upon the continued service of our executive officers and other key management and technical personnel
and on our ability to continue to attract, retain and motivate qualified personnel. In addition, implementing our product and business strategy
requires specialized engineering and other talent, and our revenues are highly dependent on technological and product innovations. The market
for employees in our industry is extremely competitive. Further, existing immigration laws make it more difficult for us to recruit and retain
highly skilled foreign national graduates of universities in the United States, making the pool of available talent even smaller. We continue to
anticipate increases in human resource needs, particularly in engineering. If we are unable to attract and retain the qualified employees, our
business may be harmed.
Item 1B. Unresolved Staff Comments
None.
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