- EU officials reviewing draft statement of objections in case
- Chip designer suspected of pricing tactics to squeeze rivals
The European Union is preparing an antitrust complaint against Qualcomm Inc. over suspected predatory pricing tactics that could hobble smaller rivals, according to three people familiar with the probe.
Regulators are in the final stages of preparing a so-called statement of objections, based on a complaint by a unit of Nvidia Corp., that asked the EU to act against predatory pricing for mobile-phone chips, the people said. Qualcomm designs chipsets that power most of the world’s smartphones, licensing its technology across the industry.
Qualcomm would add to a growing list of U.S. technology companies to face EU antitrust action, following probes into Google, Microsoft Corp. and Intel Corp. A statement of objections may lead to fines, capped at 10 percent of yearly global revenue, which can be avoided if a company agrees to make changes to business behavior.
"We have been cooperating with the European Commission from the outset of this matter and believe our business practices are lawful under EU competition rules," said Christie Thoene, a Qualcomm spokeswoman. "We believe competition in the sale of wireless chips remains strong and dynamic."
Regulators are less advanced with another probe into whether the company grants payments, rebates or other financial incentives to customers in returning for buying Qualcomm chipsets. Another case that focused on complaints that the company was charging excessive royalties on patents was dropped in 2009.
A draft complaint in the predatory pricing case, formally opened in July, is being discussed by EU officials and it’s not certain when it will be issued, said one of the people.
The European Commission declined to comment. San Diego-based Qualcomm declined to immediately comment.
Icera was bought by Nvidia, a maker of graphics chips, for $367 million in 2011. Nvidia filed a lawsuit against Qualcomm in the U.K. courts in September that didn’t give details of its claims.
Qualcomm was fined $975 million in February to settle a Chinese antitrust investigation. It also agreed to offer local companies a discount on technology licensing. The company has also disclosed that it’s facing possible investigations in the U.S. and Korea.