Qualcomm has successfully appealed a €1 billion fine from the EU over allegations it paid billions of dollars to Apple to prevent rivals from supplying the company.
The EU imposed the punishment in January 2018, claiming Qualcomm made incentive payments over a five-year period between 2011 and 2016 so that only its 4G LTE chipsets would be used in the iPhone and iPad.
Investigators took the view that these incentive payments were tantamount to ‘exclusivity payments that prevented the likes of Intel from competing for Apple’s business, damaging the market.
However, the General Court of the European Union has annulled that decision, citing issues with the EU’s investigation.
“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,” the court ruled, adding investigators had failed to support that the payments had actually reduced Apple’s incentives to switch supplier.
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EU competition authorities can appeal on ‘matters of law’ to the EU Court of Justice (CJEU), Europe’s highest court if it wishes to do so.
Ironically, Apple and Qualcomm have been engaged in legal action against each other in recent years. Qualcomm had frequently claimed Apple has violated its patents, while Apple said the Snapdragon chipmaker is abusing its dominant position in the market and charging extortionate fees.
Eventually the two firms settled their differences, with Apple agreeing to pay royalties and entering into a new supply agreement.