EU General Court upholds European Commission €242m antitrust fine against Qualcomm, after it allegedly forced a UK firm out of business
Qualcomm has loses its court appeal against a European Union antitrust penalty involving ‘predatory pricing’ against a British competitor.
EU’S General Court in Luxembourg announced on Wednesday that it “largely upholds the fine imposed on Qualcomm. The General Court sets the amount of the fine at approximately € 238.7 million as opposed to the € 242 million imposed by the Commission.”
The whole case stems from a 2009 complaint from UK-based Icera, a developer of baseband processors for 3G and 4G cellular phones and tablets, which had accused Qualcomm of anti-competitive behaviour.
2009 complaint
Icera was subsequently acquired by Nvidia in May 2011, and it later sued Qualcomm, alleging the company’s practices drove Icera out of the marketplace.
A European investigation began back in 2015 after two EU charges that accused the firm of trying to price rivals out of the mobile device industry.
In 2019 the European Commission fined Qualcomm €242m (£203m or $269m) for abusing its market dominance in 3G baseband chipsets.
“Qualcomm sold below cost, with the aim of forcing its competitor Icera out of the market,” the EC said at the time.
Regulators said at the time that Qualcomm had abused its position as a leader in the production of semiconductors for the lucrative consumer market.
“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,” EU officials said in 2019.
Qualcomm reacted angrily to the fine and promised to appeal, describing the 2019 decision as ‘meritless.’
Fine upheld
But now in September 2024 the EU’s second highest court has upheld the Commission’s fine, but slightly reduced the total fine.
“On 30 June 2009, the British company Icera lodged a complaint with the European Commission against Qualcomm, revised and updated version on 8 April 2010, on the basis of which the Commission initiated its investigation. In 2012, the intervener, the US company Nvidia, which had acquired Icera in May 2011, supplied further information, supplementing the complaint and making allegations of predatory pricing against Qualcomm,” the General Court stated.
“Between June 2010 and July 2015, the Commission sent a number of requests for information to Qualcomm, Icera, Nvidia and other players in the baseband chipset sector,” it added. “In the years following, the Commission finalised its investigation, making additional requests for information, sending statements of objections and organising hearings,” before the 2019 decision was reached.
“Qualcomm requested the Court to annul, or in the alternative, to reduce substantially the amount of the fine imposed and to that end raised fifteen pleas in law based in particular on procedural irregularities, including the excessive duration of the investigation, the alleged overly brief nature of certain notes taken during interviews not recorded by the Commission with third parties, manifest errors of assessment, of fact and of law, as well as a failure by the Commission to state reasons regarding a number of aspects of the decision in question,” the court stated.
“In its judgement, the Court makes 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.”
“As regards the finding in the contested decision regarding Qualcomm’s intention to eliminate Icera from the market in question, the Court states that the Commission substantiated that finding by providing both direct and indirect evidence,” it concluded.
“Finally, as regards the calculation of the amount of the fine, the Court finds that, in the contested decision, the Commission departed, without justification, from the methodology laid down in its 2006 guidelines. Therefore, in the exercise of its unlimited jurisdiction, the Court sets the amount of the fine imposed on Qualcomm at €238,732.”
This is not the only EU antitrust fine Qualcomm has faced.
In a separate case the European Commission had fined Qualcomm $1.23 billion after concluding it bribed Apple to stifle competition, but the General Court overturned that decision in 2022 after the company appealed.
