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EU fines U.S. chipmaker Qualcomm €242m for predatory pricing
Published : 18 Jul 2019, 20:48
The European Commission on Thursday fined U.S. chipmaker Qualcomm 242 million euros for predatory pricing.
Margrethe Vestager, the European Commissioner in charge of competition policy, said in a statement that "Baseband chipsets are key components so mobile devices can connect to the Internet. Qualcomm sold these products at a price below cost to key customers with the intention of eliminating a competitor. Qualcomm's strategic behaviour prevented competition and innovation in this market, and limited the choice available to consumers in a sector with a huge demand and potential for innovative technologies. Since this is illegal under EU antitrust rules, we have today fined Qualcomm 242 million euros."
The case concerns Qualcomm chipsets of the third generation ("3G") standard between mid-2009 and mid-2011, and the European Commission found the U.S. chip giant's intention was to eliminate Icera, its main rival - a growing threat at the time - to Qualcomm's chipset business in the market segment offering advanced data rate performance.
In May 2011, Icera was acquired by U.S. tech company Nvidia, which decided to wind down its baseband chipset business line in 2015.
The European Commission said the fine, taking account of the duration and gravity of the infringement, represents 1.27 percent of Qualcomm's turnover in 2018 and is also aimed at deterring market players from engaging in such anti-competitive practices in the future.
Brussels also ordered Qualcomm not to engage in such practices or practices with an equivalent object or effect in the future.