Qualcomm wins battle against EU regulator’s $1 bn anti-trust fine

London: Europe’s second-highest court on Wednesday sided with chip-maker Qualcomm that had appealed 1 billion euros ($1.04 billion) anti-trust fine from the European Union (EU) regulators over payments made to Apple to use its chips.

The EU had issued the fine in 2018, and said payments Qualcomm had made to Apple between 2011 and 2016 to exclusively use its chips were illegal under EU antitrust rules.

Apple sued Qualcomm in 2017 for nearly $1 billion over royalties, with Cupertino-based tech giant alleging the wireless chipmaker did not give fair licensing terms for its processor technology.

On Wednesday, the General Court annulled the European Commission’s decision imposing on Qualcomm a fine of approximately 1 billion euros, saying it observed that a “number of procedural irregularities affected Qualcomm’s rights of defence”.

The ruling invalidated the European Commission’s analysis of the conduct alleged against Qualcomm.

On January 24, 2018, the Commission imposed on Qualcomm a fine of close to 1 billion euros for abuse of dominance on the worldwide market for chipsets compatible with the Long Term Evolution (LTE) standard.

“The infringement lasted from February 2011 to September 2016. According to the Commission, that abuse was characterised by the existence of agreements providing for incentive payments, under which Apple had to obtain its requirements for LTE chipsets exclusively from Qualcomm,” said the ruling by the General Court.

In the judgment, the General Court annulled, in its entirety, the Commission decision.

“The General Court bases its conclusions on, first, the finding of a number of procedural irregularities which affected Qualcomm’s rights of defence, and, second, an analysis of the anticompetitive effects of the incentive payments,” it said in a statement.

The General Court concluded that the Commission’s analysis was not carried out in the light of all the relevant factual circumstances and “that it is, therefore, unlawful”.

The EU regulators can now appeal the decision to the EU Court of Justice (CJEU).