EC launches antitrust probe against Qualcomm
Published: 02 Oct 2007 08:46 BST
Following its recent victory over Microsoft, the European Commission has now turned its attention to Qualcomm and announced an antitrust investigation involving the mobile giant.
The European Commission announced the investigation on Monday over an "alleged breach of EC Treaty rules on abuse of a dominant market position" by Qualcomm.
The investigation follows accusations by six mobile and chipset vendors, including Ericsson, NEC and Nokia, first filed in 2005. The companies allege Qualcomm does not license its 3G patents under "fair, reasonable and non-discriminatory" terms.
The six have accused Qualcomm of violating competition rules by charging "disproportionate and discriminatory royalties" for its essential patents and having tried to exclude competing manufacturers of chipsets from the market and to prevent others from entering.
Failing to license the patents under such terms "could lead to final consumers paying higher handset prices, a slower development of the 3G standard, and all the related negative consequences for economic efficiency associated with inhibited growth of the standard," the European Commission said.
Under the investigation, the case will be treated as a priority, although the European Commission said it had no proof of an infringement.
Steven Altman, president of Qualcomm, said the company had contributed to the growth of 3G standard W-CDMA and added that Qualcomm has licensed its patents under fair, reasonable and non-discriminatory terms.
"We welcome the continuation of our dialogue with the Commission in order to demonstrate that the complaints are without merit and are motivated by commercial considerations of the entrenched complainants who are trying to stifle the competition that Qualcomm brings to the market," Altman said in a statement.
The relationship between Qualcomm and Nokia, one of the six vendors accusing the mobile IP firm of abusing its market position, has been fractious in recent years.
In late 2005, Qualcomm filed a suit in the US high courts claiming infringement of key patents by Nokia. In 2006, it filed a similar complaint in the UK courts and lodged a complaint with the US International Trade Commission (ITC), claiming Nokia was engaging in unfair trade practices.
For its part, Nokia has requested the ITC bar imports of some Qualcomm chipsets to the US, alleging they infringe five Nokia patents, in addition to its antitrust complaint to the European Commission.
The handset maker has also filed a patent-exhaustion case against Qualcomm in both Germany and the Netherlands, asking the country's courts to declare that Qualcomm's European patents are exhausted in respect to products placed on the EU market with a Qualcomm licence.
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