The European Union announced Thursday that it has started two investigations into possible abuse of market dominance by chipmaker Qualcomm in the latest in a string of antitrust and tax inquiries into major U.S. corporations.
"We are launching these investigations because we want to be sure that high tech suppliers can compete on the merits of their products," European Competition Commissioner Margrethe Vestager said in a press release. "Many customers use electronic devices such as a mobile phone or a tablet and we want to ensure that they ultimately get value for money. Effective competition is the best way to stimulate innovation."
The first investigation will examine whether Qualcomm, the market leader in chips used for voice and data transmission in smartphones, tablets and other mobile devices, offered financial incentives to customers on the condition that they bought exclusively, or almost exclusively, from Qualcomm.
The second will look at whether Qualcomm engaged in "predatory pricing" by charging at less than cost with a view to forcing competitors out of the market, Reuters reported.
Qualcomm responded to the probes by saying the accusations were "without merit," according to USA Today.
"We were informed that the European Commission has taken the procedural step of 'initiating proceedings' against Qualcomm with regard to the two ongoing investigations into Qualcomm's sale of chipsets for mobile devices," the company said. "This step allows investigators to gather additional facts, but it represents neither an expression by the Commission on the merits of the case nor an accusation against the Company. While we were disappointed to hear this, we have been cooperating and will continue to cooperate with the Commission."
The investigations are the latest involving EU cases targeting U.S. companies, with others including Amazon.com, Google, Apple, MasterCard and Hollywood studios. Vestager told EU lawmakers several minutes after announcing the Qualcomm probes that she sees no need to wait to finish her current case against Google before filing new antitrust complaints against the company.
"If you operate in Europe, you have to play by European competition rules, whether you are European or foreign," Ricardo Cardoso, Vestager's spokesman, said at a press briefing in Brussels, The Globe And Mail reported.
The commission has not set a deadline for finishing the investigations, having said that it will "examine the cases as a matter of priority."
