Qualcomm can’t escape EU wrath! Fine lowered but antitrust violation confirmed

Qualcomm faces another blow in its ongoing battle with European regulators. The European Court of First Instance has upheld most of the tech giant’s hefty antitrust fine, albeit with a slight reduction. The penalty, initially set at €242 million, was trimmed to €238.7 million after the court ruled that some calculation errors had been made in the original assessment.

This ruling stems from Qualcomm’s controversial business practices between 2009 and 2011. During this period, the chipmaker was found to have deliberately sold its 3G baseband chipsets below cost, a strategy aimed at undermining British rival Icera, now owned by Nvidia. Qualcomm targeted key clients Huawei and ZTE, offering them these chipsets at prices that significantly undercut their true value. The European Commission in 2019 concluded that these moves were intended to eliminate Icera from the market.

Qualcomm’s Legal Woes Continue With Little Relief

While Qualcomm hoped for a complete dismissal of the fine, the General Court was largely unmoved by the company’s pleas. The court’s review of Qualcomm’s arguments, including claims that the affected chipsets only represented a small fraction of the market, was thorough. However, it upheld most of the European Commission’s conclusions. Qualcomm’s assertion that its actions didn’t threaten the broader market fell flat, with the court maintaining that any deliberate move to wipe out competitors was inherently anti-competitive.

The €238.7 million fine is far from the only headache Qualcomm has faced in Europe. In 2022, the company successfully overturned a much larger €997 million fine that was imposed over exclusivity payments made to Apple. That case, involving allegations of bribery to block out rivals such as Intel, showed that while Qualcomm can sometimes escape, the European regulators remain relentless.

Industry Expert Views: Qualcomm’s Strategies Under Scrutiny

Experts in competition law argue that Qualcomm’s loss in this case highlights broader concerns about the pricing strategies of major tech firms. One analyst noted that predatory pricing, especially in the technology sector, could set dangerous precedents by wiping out smaller, innovative competitors. “The decision sends a clear message: Europe will not tolerate manipulation in such crucial sectors,” a market expert observed.

This ruling marks another chapter in Qualcomm’s long-running battle with European regulators. The tech giant’s appeal options remain open, with the potential for the case to go to the European Court of Justice. However, with most of the company’s arguments already rejected, it’s unclear whether a further appeal would lead to any major changes.

What’s Next for Qualcomm?

With its legal troubles mounting, Qualcomm may need to reassess its strategies in Europe. The company, which did not immediately respond to requests for comment, faces increasing scrutiny from regulators across the globe. Qualcomm is a market leader in mobile chipsets, and its position in the market gives it significant influence. However, this also puts the company under a microscope, particularly regarding how it interacts with competitors and customers.

Qualcomm’s appeal options are limited, and while the fine reduction offers some relief, the court’s strong language suggests the company will face ongoing challenges in maintaining its market dominance without stepping into legal grey areas.