American chip making firm Qualcomm won its appeal of a 997 million euro ($1.05 billion) sentence levied by EU antitrust regulators four years ago on Wednesday, handing a huge setback to EU antitrust commissioner Margrethe Vestager’s campaign on Big Tech.
According to the European Commission’s 2018 judgement, Qualcomm paid Apple billions of dollars between 2011 and 2016 to use exclusively its chips in all iPhones and iPads, thereby blocking out rivals such as Intel Corp.
Qualcomm’s penalties is one of several issued by Vestager on corporations ranging from Alphabet subsidiary Google to banks and truck manufacturers for anti-competitive behaviour. Apple, Amazon, and Facebook are all under investigation.
The General Court, Europe’s second-highest court, overturned the EU decision and chastised the EU competition enforcer for its handling of the case.
“A number of procedural irregularities affected Qualcomm’s rights of defence and invalidate the Commission’s analysis of the conduct alleged against Qualcomm,” judges said.
“The Commission did not provide an analysis which makes it possible to support the findings that the payments concerned had actually reduced Apple’s incentives to switch to Qualcomm’s competitors in order to obtain supplies of LTE chipsets for certain iPad models to be launched in 2014 and 2015,” they said.
The EU competition enforcer may file a legal challenge at the EU Court of Justice (CJEU), Europe’s top court.
The Commission stated that it would carefully review the decision and its consequences before deciding on its next measures.
There was no comment on the issue from Qualcomm.
“The high-level conclusion is that the Court is telling the Commission to be extremely cautious in pricing abuses,” said Assimakis Komninos, a partner at law firm White & Case.
“The Commission will now be very hesitant to start investigations into such cases unless they are really sure,” he said.
This is Vestager’s second major defeat; in January, she lost the court’s support for a 1.06 billion euro fine imposed on Intel 12 years ago for squeezing rival Advanced Micro Devices.
Vestager’s next test comes on September 14, when the General Court rules on Google’s appeal of a record 4.34 billion euro antitrust penalties for using its Android mobile operating system to drive out competitors.
(Adapted from Reuters.com)