Chipmaker Qualcomm gets $1 billion antitrust fine overturned 

LUXEMBOURG (CN) — U.S. chipmaker Qualcomm persuaded the EU’s second-highest court on Wednesday to annul a $1.05 billion antitrust fine.

The General Court identified “procedural irregularities” in the case that the European Commission brought against the San Diego-based tech giant whose semiconductor components are used in everything from laptops to watches.

When the European Union’s executive branch put the case together in 2018, it accused Qualcomm of having paid smartphone maker Apple not to use chips from rival companies. Brussels contended that Qualcomm, at a time when it had cornered 90% of the chip market, paid the iPhone maker billions from 2011 to 2016, calling such behavior an anticompetitive abuse of its dominant position in the chip market. “This meant that no rival could effectively challenge Qualcomm in this market, no matter how good their products were,” competition czar Margrethe Vestager said of the case in 2018.

Qualcomm fought back, arguing that, during the time in question, Apple had no alternative chip supplier and that the exclusivity agreements did not constitute anticompetitive behavior.

The Luxembourg-based court agreed, unable to find that the behavior was illegal and also calling out errors in the commission’s investigation. The analysis “was not carried out in the light of all the relevant factual circumstances,” the five-judge panel found.

Qualcomm also persuaded the court that Brussels failed to provide it with relevant documents and refused to provide an explanation as to why this information was not made available. “The General Court observes that a number of procedural irregularities affected Qualcomm’s rights of defense,” the court said in a statement about the decision.

It’s the latest in a series of losses for Vesteger, who has been trying to crack down on what her office sees as tech companies abusing their market position. The same court sided with Intel, another U.S. chipmaker, in a similar case in January.

“We are pleased with the General Court’s decision,” Qualcomm said in a statement Tuesday.

The commission now has two months to appeal the decision to the EU’s highest court.

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