Qualcomm’s Antitrust Fine for Payments to Apple Is Annulled by European Court

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BRUSSELS—The European Union’s second-highest court scrapped a €997 million ($1.04 billion) fine that the bloc’s antitrust regulator had levied on Qualcomm Inc. over payments it made to Apple Inc. for the iPhone maker’s exclusive use of Qualcomm chips.

The General Court of the European Union on Wednesday said the European Commission, the EU’s executive arm, had included a number of irregularities when it was putting together the case-file against San Diego-based Qualcomm, a supplier of chips for phones, cars and other devices.

“The General Court observes that a number of procedural irregularities affected Qualcomm’s rights of defense and invalidate the Commission’s analysis of the conduct alleged against Qualcomm,” the court said.

A commission spokeswoman said the regulator would study the ruling and assess possible next steps.

A Qualcomm spokesperson said the company welcomed the court’s decision.

The court’s findings focused on matters of procedure, rather than competition law. While the ruling, which can be appealed to the EU’s Court of Justice, doesn’t appear to open new issues of EU antitrust legislation, it could still have a profound impact on the commission’s operations, said a Brussels-based competition lawyer who isn’t directly involved in the case.

By finding significant faults with how the commission built and pursued its case against Qualcomm, the court may prompt the EU regulator to move more cautiously and slowly on other cases, the lawyer said.

EU antitrust chief Margrethe Vestager imposed the fine in early 2018, saying Qualcomm had abused its dominant position by paying billions of dollars to Apple from 2011 to 2016 on the condition it wouldn’t buy from rivals, hindering competition in the market for so-called baseband chips, which connect smartphones and tablets to cellular networks.

The payments were made directly rather than through discounts, the EU said.

Write to Mauro Orru at [email protected] and Daniel Michaels at [email protected]

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