On Tuesday 8 December, the EC´s antitrust department, headed by the now well-known Commissioner Margrethe Vestager, charged yet another big US company with anti-competitive behavior. Qualcomm, US-based producer of mobile chips and global leader in this segment (last year, it occupied 80% of global market in 4G chipsets, though this share is decreasing due to Asian competition), was sent two separate charge sheets (called Statements of Objections in EU-jargon). The investigations were formally opened this summer. In the first case, the EC alleges Qualcomm that it paid a major producer of mobile devices substantial sums of money to assure exclusivity of its chipsets. This agreement is said to be still in force. The EC, however, refused to name the producer. In the second case, Qualcomm is charged with predatory pricing. Between 2009 and 2011, Qualcomm, a dominant player on the market, is said to have sold some chipsets below their production costs to force a new competitor out of the market. The competitor was Icera, an Nvidia subsidiary based in the UK. Under EU rules, such practice can be qualified as abuse of dominant position.
Qualcomm is the 4th US-based tech giant targeted by the EC, after Google, Apple and Amazon (with other US firms from other sectors suffering the same fate – Starbucks, McDonald´s). The EU is thus often seen as biased against US companies on the other side of the Atlantic. Qualcomm will now have 3 to 4 months to respond to the allegations and additionally, it can ask for oral hearing in both cases. The final EC decision could lead to a fine of 20% of annual revenues, approx. €20 billion, though usually the fines are much smaller. Any decision can be also taken to EU court.
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