In Short:
Europe’s second-highest court has upheld a reduced EU antitrust fine of €238.7 million ($265.5 million) against Qualcomm for selling chipsets below cost from 2009 to 2011, a practice called predatory pricing, aimed at blocking competitor Icera. Qualcomm can appeal to the EU’s highest court but previously won against a larger fine related to its deals with Apple.
On Wednesday, Europe’s second-highest court upheld the majority of an EU antitrust fine levied against the U.S. chipmaker Qualcomm, slightly reducing the amount from an initial €242 million to €238.7 million ($265.5 million).
Background of the Case
The European Commission imposed this fine in 2019, accusing Qualcomm of engaging in predatory pricing by selling its chipsets below cost between 2009 and 2011. This practice was aimed at undermining Icera, a British phone software maker now affiliated with Nvidia Corp.
Qualcomm’s Arguments
Qualcomm contended that the 3G baseband chipsets cited in the case represented merely 0.7% of the Universal Mobile Telecommunications System (UMTS) market, asserting that it was not feasible for the company to exclude competitors from the chipset market.
Court Ruling
The General Court, based in Luxembourg, stated that it conducted “a detailed examination of all the pleas put forward by Qualcomm, rejecting them all in their entirety, with the exception of a plea concerning the calculation of the amount of the fine, which it finds to be well founded in part.”
Next Steps for Qualcomm
Qualcomm has the option to appeal on legal points to the EU Court of Justice, which is the highest court in Europe. Meanwhile, the company has not provided an immediate response to a comment request from Reuters.
Previous Legal Outcomes
Interestingly, Qualcomm successfully persuaded the same court two years prior to annul a €997 million antitrust fine imposed in 2018, which stemmed from payments made to Apple for exclusive use of its chips in iPhones and iPads, aimed at excluding rivals like Intel Corp. from the market. Following that ruling, the EU watchdog chose not to appeal.
Case Reference
The case is officially designated as T-671/19 Qualcomm v Commission (Qualcomm – predatory pricing).
© Thomson Reuters 2024
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