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The
move by European Competition Commissioner Margrethe Vestager
suggests she may be more willing to take temporary but rapid
action against tech giants deemed to be abusing their dominance
rather than wait for investigations to be finalised.
Google <GOOGL.O> critics have for years urged Vestager to target
the Alphabet Inc. subsidiary with such interim measures during
its 10-year battle with EU antitrust regulators.
"It doesn't necessarily say that now we have all cases lined up
where interim measures will be used but it means that the tool
is on the table," Vestager told a news conference.
"And if we find cases that live up to the two things that have
to be fulfilled at the same time, yes, we will indeed use
interim measures more often," she said.
This is the first such order in 18 years.
Broadcom said it would comply with the order but would launch an
appeal in the European courts, disputing the commission's
assessment of provisions in its contracts.
"We do not believe that these provisions have a meaningful
effect on whether the customers choose to purchase Broadcom
products," the company said, adding that the order would not
have a material impact on its set-top box and modem businesses.
The European Commission had in June warned Broadcom of a
possible interim measure. The company, whose chips power
smartphones, computers and networking equipment, is a major
supplier to Apple <AAPL.O>.
The Commission said Broadcom has 30 days to comply with the
order, which is valid for up to three years, an estimate of how
long the EU investigation will take.
The EU regulator said certain provisions in the deals with six
of its major customers are likely to cause serious and
irreparable harm to the competition as well as affect future
tenders related to the introduction of WiFi 6 standard for
modems and TV set-top boxes.
The competition enforcer's concerns center on Broadcom's deals
with six TV set-top box and modem makers which result in the
companies buying various chips exclusively or almost exclusively
from the company.
Contentious practices include tying rebates or other benefits to
exclusive or minimum-purchase requirements. Reuters reported on
Oct. 4 that the Commission would order Broadcom to suspend these
practices.
(Reporting by Foo Yun Chee; Additional reporting by Marine
Strauss; Editing by Louise Heavens and Edmund Blair)
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