The European Commission, the governing body of the European Union, fined U.S. tech conglomerate Qualcomm nearly 1 billion euros for conspiring with Apple.
“Qualcomm illegally shut out rivals from the market for LTE baseband chipsets for over five years, thereby cementing its market dominance,” Competition Commissioner Margrethe Vestager said Wednesday, according to an official press release. “Qualcomm paid billions of US Dollars to a key customer, Apple, so that it would not buy from rivals.”
Vestager contends that payments were not just through discounts, but “on the condition that Apple would exclusively use Qualcomm’s baseband chipsets in all its iPhones and iPads.”
This agreement, according to Vestager, essentially meant that no one could compete with Qualcomm in getting their proprietary technology in Apple products, which ultimately restricts choice and innovation.
Market dominance itself is not an act of abuse, but using that dominance to restrict competition and sabotage rival firms is a violation of the EU’s antitrust rules. The 997,439,000 euro ($1,234,729,738 USD) fine is based off of “the duration and gravity of the infringement,” and equals 4.9 percent of Qualcomm’s turnover in 2017.
Qualcomm says it “strongly disagrees” with the EU’s decision.
“We are confident this agreement did not violate EU competition rules or adversely affect market competition or European consumers,” said Don Rosenberg, executive vice president and general counsel of Qualcomm. “We have a strong case for judicial review and we will immediately commence that process.”
Apple and Qualcomm seem to have a fairly interesting relationship, as the two often make mutually beneficial business arrangements but also engage in legal battles, such as allegations of stolen technology.
But more importantly, the substantial monetary penalty is yet another sign that Europe is constantly ready to go toe-to-toe with any U.S.-based tech company. The European Commission’s anti-competition watchdog arm and the larger group in general has fined a number of firms for alleged violations like tax evasion, inappropriate data collection and exploiting personally dominant stature in the market. (RELATED: Europe Vs. Silicon Valley: How The Continent Is Responding To Big Tech’s Growing Power)
Apple did not respond to The Daily Caller News Foundation’s request for comment by time of publication, while Qualcomm declined to elaborate beyond its own press release.
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