Qualcomm has just lost to the European Commission, which for several years asked it to transfer certain data as part of an antitrust investigation. The company refused because it considered that the request went beyond the original procedure.
“In view of the broad investigative powers conferred on the Commission by Regulation 1/2003, it is for the Commission to decide whether specific information is necessary to enable it to identify an infringement of the competition rules” , said the Court of Justice of the European Union in its ruling.
The details of the information requested by the European executive remains confidential but given Qualcomm’s position, they must touch sensitive data.
Predatory pricing to compete with Icera
The facts date back to 2015 when the Commission opened formal proceedings against the San Diego designer who was accused of predatory pricing between 2009 and 2011 to crush Icera, its main competitor at the time in a market segment offering high-level performance in terms of data flow, since acquired by Nvidia.
During its investigation in January 2017, the institution sought additional information from Qualcomm. Receiving no response, she made a formal decision directing the company to comply with this request. This did not please Qualcomm, who appealed to the General Court of the European Union considering that this request exceeded the scope of the investigation. The judge rejected this appeal and thus supported the Commission. On June 18, 2019, Qualcomm appealed for the annulment of the judgment of the General Court. It has therefore just been rejected.
A fine of 242 million euros
In July 2019, the Commission finally imposed a fine of € 242 million on the integrated circuit manufacturer for practicing predatory pricing. “Qualcomm’s strategic behavior has prevented competition and innovation in this market and limited the choice available to consumers in an industry where the demand for and potential for innovative technologies is enormous, ” said Margrethe Vestager, Commissioner responsible for competition policy.
Now that the procedure is closed, the victory of the Commission does not have any major consequences. It has the merit of recalling the institution’s extensive investigative powers. Moreover, Qualcomm is still in its sights. Last February, the Commission opened an investigation to determine whether the company abused its dominant position in the 5G modem market to impose itself on the associated radio frequency modules market. The outcome of the proceedings is not yet known.