May 15 (Reuters) - Arm Holdings faces an

antitrust probe by the U.S. Federal Trade Commission over the

British chip designer's licensing of its semiconductor

technology, part of global scrutiny of the business, Bloomberg

News reported on Friday.

The FTC is investigating whether Arm is trying to illegally

monopolize parts of the semiconductor market, the report said.

It is looking to assess whether Arm will reject or downgrade the

licensing agreements for its chip blueprints used to design

central processing units, the report said, citing people

familiar with the matter.

The U.S. regulator notified Arm of the investigation this

year and demanded the company preserve documents, according to

Bloomberg.

Arm declined to comment on any possible investigation.

The FTC did not immediately respond to a request for comment.

Qualcomm ( QCOM ) and Arm are in a dispute over whether Qualcomm ( QCOM )

breached a contract with Arm after it bought chip startup Nuvia.

Arm said in a statement: "Qualcomm's ( QCOM ) baseless allegation of

anticompetitive conduct is nothing more than a desperate and

underhanded attempt to obtain leverage in the parties' ongoing

commercial dispute for its own competitive benefit."

Qualcomm ( QCOM ) did not immediately respond to a request for

comment.

A big portion of Arm's revenue comes from licensing its

technology to companies such as Nvidia ( NVDA ) and Apple ( AAPL )

and collecting royalty payments on design use.

Regulators outside the U.S. are also probing Arm's

practices.

South Korea's antitrust regulator was investigating the

Seoul offices of Arm in November, as part of ongoing scrutiny of

the company's licensing practices. Bloomberg reported that the

South Korean investigation stemmed from a complaint from

Qualcomm ( QCOM ), but Reuters could not verify that claim.