Qualcomm, Inc. Faces Antitrust Investigation In EU

Qualcomm, Inc. Faces Antitrust Investigation In EU
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The main regulatory body of the EU, the European Commission, announced two separate antitrust investigations into the marketing practices of chipmaker Qualcomm, the latest in a number of recent probes that have targeted U. S. technology giants.

The EC regulators noted they were investigating whether Qualcomm, one of the world’s largest chip makers for mobile devices, abused its dominant market position in the region by offering financial incentives to potential customers if they bought equipment solely from the American company.

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European authorities will also take a look at whether Qualcomm unfairly set prices below its manufacturing costs to push competitors out of the market.

Statement from top EU regulator

“We want to be sure that high-tech suppliers can compete on the merits of their products,” Margrethe Vestager, the EU’s top regulator, commented in a statement on Thursday. “Many customers use electronic devices such as a mobile phone or a tablet, and we want to ensure that they ultimately get value for money.”

Statement from Qualcomm

In response to the announcement of the EC’s investigations, Qualcomm noted it was disappointed that the commission had begun investigations, but that the firm would continue to cooperate with the EU’s antitrust officials.

“We continue to believe that any concerns are without merit,” Qualcomm noted in its statement.

More on the EU investigations

The EC’s decision to move ahead with the investigations comes just a couple of months following an agreement by Qualcomm to cough up a $975 million fine for violating antimonopoly laws in China. To settle the charges, the chipmaker agreed to offer licenses for communications systems for high-speed data to smartphones at a large discount to what it charges in other parts of the world.

Qualcomm has been the target of prior antitrust investigations by EU officials. Regulators finally gave up after a two-year-long investigation in 2009 when they could not find any good evidence that the company was charging excessive royalties to license its patents.

However, UK-based chip maker Icera filed another complaint against Qualcomm in 2010, alleging the firm used unfair financial incentives to bring in new customers. Of note, that complaint is the primary basis for the EC’s current antitrust investigations.

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