EU competitive guardians are against Broadcom

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Broadcom

The European Commission wants to take action against the US company because of antitrust violations.


(Photo: Reuters)

Brussels The digital markets are developing fast – often too fast for the competitive guardians. EU Commissioner Margrethe Vestager is now reactivating a long-idle instrument to speed up the crackdown on companies that abuse their market power: According to insiders, she is expected to commit the US chip company Broadcom to “specific interim measures” this week or next week until further notice no longer applicable.

The Commissioner does not wait until her experts have completed the formal investigation. Vestager had already stated at the start of the trial in June that she wanted to order a quick stop to Broadcom's practices to “avoid any risk of seriously and irreparably damaging competition”. Now she proceeds to action, as first reported by the Financial Times,

The EU competition watchdog suspects the US company of using its dominant position in digital TV decoders and modems to drive competitors out of the market. Thus, Broadcom has contractually obliged the major device manufacturers to install only their own chipsets. The company described the allegations as unjustified at that time and could take legal action against a provisional prohibition of practice.

It is the first time since 2001 that the Commission orders such interim measures. Behind this is the insight that the investigations of the competition guardians often take too long – in the case of Google Shopping passed almost seven years between the opening of the court and the final billions.

“We need to be able to intervene quickly,” says Vestager, who was again nominated by the future Commission President Ursula von der Leyen as the highest EU competition guardian. It was important to prevent competitors from being forced out of the market in the meantime.

The French antitrust authority already regularly orders such provisional measures. However, the EU Commission has not used the instrument for nearly 20 years.

Experts such as Tilman Kuhn, partner at the firm White & Case, refer to the high legal hurdles that EU law provides for such a profound intervention. Thus, the authority not only had to prove a clear rule violation, but also acute and serious effects on the competition – and the court. According to Kuhn, Vestager now signals that “more risk-taking and aggression”.

More: How Ursula von der Leyen wants to pacify the EU Commission – With the Germans, a rational leadership style is finding its way into the EU Commission. The future president does not want to leave anything to chance.

(TagToTranslate) Broadcom (t) Margrethe Vestager (t) EU Commission (t) Antitrust policy (t) Antitrust by industry (t) Unfair competition (t) Deregulation (t) White & Case (t) Google (t) Margrethe Vestager (t) Ursula von der Leyen

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