Hot on the heels of the announcement of a record antitrust fine imposed by the European antitrust regulator upon another US technology company , the European Commission announced on 19th July 2018 that it had sent a Supplementary Statement of Objections to Qualcomm. This is in connection with its predatory pricing investigation against the US technology company which is also the world’s largest supplier of smartphone chipsets
This move by the Commission reinforces the Commission’s policy of taking on high profile cases against major global technology firms. However politically it will increase tension between on the one hand, the US President, Donald Trump who has accused Europe of taking advantage of US technology firms , and the EU Commission on the other that maintains a dispassionate stance that it is only doing its job enforcing competition law as an antitrust regulator .
The Commission’s investigation began with the issue of an original Statement of Objections against Qualcomm on 8th December 2015 ( Case AT.39711 – Qualcomm (predatory pricing) ). The Commission’s case is that Qualcomm has breached Article 102 of the TFEU as a result of certain predatory pricing practices. More particularly the allegations were that between 2009 and 2011, Qualcomm forced its rival Icera out of the market by selling its UMTS baseband chipsets at prices below cost. UMTS chipsets are key components of mobile devices that enable both voice and data transmission in third generation (3G) cellular communication.
According to the Commission this was allegedly done as at at time when Icera was posing a threat to Qualcomm and that the pricing below cost was a targeted action to force Icera out of the market.
The Supplementary Statement of Objections focuses on certain elements of the “price-cost” test applied by the Commission to assess the extent to which UMTS baseband chipsets were sold by Qualcomm at prices below cost.