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Short Reads

Qualcomm loses General Court battle over request for information

Qualcomm loses General Court battle over request for information

Qualcomm loses General Court battle over request for information

02.05.2019 NL law

The General Court (GC) recently rejected Qualcomm's appeal against a Commission decision requesting information. The Commission's request was presented to the company after the issuance of a statement of objections.

The Commission was found to have properly stated the reasons for the request, and complied with the legal requirements. The necessity of the information was not called into question by the prior issuance of the statement of objections. For undertakings under investigation, cooperation is key, as successfully appealing RFIs is generally a daunting task.

The case centres around a predatory pricing investigation on the chip market. In 2017, the Commission issued a statement of objections against Qualcomm. Following the undertaking's response to the statement of objections, the Commission issued an RFI. The questions asked were varied but mostly connected to potential adjustments of the price-cost test methodology. Qualcomm's partial refusal to answer resulted in a decision requesting the information under threat of a EUR 580,000 penalty per day of delay.

Dealing with the company's appeal, the GC restated that the statement of objections is a procedural, preparatory document. After its issuance, the Commission can continue its investigation. This 'late RFI issuance' does not call into question the necessity of the information requested, or the lawfulness of the request itself. However, there are two conditions limiting the Commission's powers in this context. First, the requested information should enable the Commission to obtain information necessary for the investigation. While what qualifies as necessary falls under the Commission's powers of appreciation, there must be a correlation between the information requested and the presumed infringement. Second, the parties must have the opportunity to comment on fresh matters of fact and law arising from the response to the RFI. The GC found that the RFI directed at Qualcomm complied with the legal requirements.

Considering the Commission's broad powers of investigation and assessment, RFIs should be appealed with caution. The judgment of the GC serves as reminder to undertakings receiving RFIs of the importance of collaboration with the Commission's investigation.

 

This article was published in the Competition Law Newsletter of May 2019. Other articles in this newsletter:

Team

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