Qualcomm, Inc. and Qualcomm Europe, Inc. v European Commission.

• Jurisdiction: European Union
• ECLI: ECLI:EU:C:2021:76
• Docket Number: C-466/19
• Celex Number: 62019CJ0466
• Court: Court of Justice (European Union)
• Date: 28 January 2021

JUDGMENT OF THE COURT (Eighth Chamber)

28 January 2021 ( *1 )

(Appeal – Competition – Abuse of dominant position – Market for UMTS-compliant baseband chipsets – Regulation (EC) No 1/2003 – Article 18(3) – Decision to request information – Necessity of the information requested – Proportionality – Burden of proof – Self-incrimination)

In Case C‑466/19 P,

APPEAL under Article 56 of the Statute of the Court of Justice of the European Union, brought on 18 June 2019,

Qualcomm Inc., established in San Diego (United States),

Qualcomm Europe Inc., established in Sacramento (United States), represented by M. Pinto de Lemos Fermiano Rato, avocat, and M. Davilla, dikigoros,

appellants,

the other party to the proceedings being:

European Commission, represented by H. van Vliet, G. Conte, M. Farley and C. Urraca Caviedes, acting as Agents,

defendant at first instance,

THE COURT (Eighth Chamber),

composed of N. Wahl, President of the Chamber, F. Biltgen and L.S. Rossi (Rapporteur), Judges,

Advocate General: M. Bobek,

Registrar: A. Calot Escobar,

having regard to the written procedure,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1 By their appeal, Qualcomm Inc. and Qualcomm Europe Inc. seek to have set aside the judgment of the General Court of the European Union of 9 April 2019, Qualcomm and Qualcomm Europe v Commission (T‑371/17, not published, EU:T:2019:232; ‘the judgment under appeal’), by which the General Court dismissed their action for annulment of Commission Decision C(2017) 2258 final of 31 March 2017 relating to a proceeding pursuant to Article 18(3) and to Article 24(1)(d) of Council Regulation (EC) No 1/2003 (Case AT.39711 – Qualcomm (predation)) (‘the decision at issue’).

Legal context

2 Under recitals 23 and 37 of Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles [101] and [102 TFEU] (OJ 2003 L 1, p. 1): ‘(23) The [European] Commission should be empowered throughout the [European Union] to require such information to be supplied as is necessary to detect any agreement, decision or concerted practice prohibited by Article [101 TFEU] or any abuse of a dominant position prohibited by Article [102 TFEU]. When complying with a decision of the Commission, undertakings cannot be forced to admit that they have committed an infringement, but they are in any event obliged to answer factual questions and to provide documents, even if this information may be used to establish against them or against another undertaking the existence of an infringement. … (37) This Regulation respects the fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union. Accordingly, this Regulation should be interpreted and applied with respect to those rights and principles.’

3 Article 18(1) to (3) of the regulation, that article being entitled ‘Requests for information’, provides: ‘1. In order to carry out the duties assigned to it by this Regulation, the Commission may, by simple request or by decision, require undertakings and associations of undertakings to provide all necessary information. 2. When sending a simple request for information to an undertaking or association of undertakings, the Commission shall state the legal basis and the purpose of the request, specify what information is required and fix the time-limit within which the information is to be provided, and the penalties provided for in Article 23 for supplying incorrect or misleading information. 3. Where the Commission requires undertakings and associations of undertakings to supply information by decision, it shall state the legal basis and the purpose of the request, specify what information is required and fix the time-limit within which it is to be provided. It shall also indicate the penalties provided for in Article 23 and indicate or impose the penalties provided for in Article 24. It shall further indicate the right to have the decision reviewed by the Court of Justice [of the European Union].’

4 Article 24 of that regulation, entitled ‘Periodic penalty payments’, provides: ‘1. The Commission may, by decision, impose on undertakings or associations of undertakings periodic penalty payments not exceeding 5% of the average daily turnover in the preceding business year per day and calculated from the date appointed by the decision, in order to compel them: … (d) to supply complete and correct information which it has requested by decision taken pursuant to Article 17 or Article 18(3); … 2. Where the undertakings or associations of undertakings have satisfied the obligation which the periodic penalty payment was intended to enforce, the Commission may fix the definitive amount of the periodic penalty payment at a figure lower than that which would arise under the original decision. …’

Background to the dispute and the decision at issue

5 The background to the dispute is set out in paragraphs 1 to 18 of the judgment under appeal. For the purposes of the present proceedings, this may be summarised as follows.

6 Qualcomm and Qualcomm Europe are companies established in the United States which are active in the design and marketing of baseband chipsets.

7 Following a complaint lodged on 8 April 2010 by Icera Inc., another company active in that sector, the Commission opened an investigation into an alleged abuse of dominant position, within the meaning of Article 102 TFEU, by the appellants, involving the application of predatory pricing in the market for UMTS-compliant (Universal Mobile Telecommunications System) baseband chipsets. In that context, between 7 June 2010 and 14 January 2015, the Commission sent the appellants a number of requests for information on the basis of Article 18 of Regulation No 1/2003.

8 On 8 December 2015, the Commission sent the appellants a statement of objections, following the initiation of formal proceedings against them on 16 July 2015. In that statement of objections, the Court reached the preliminary conclusion that the appellants had abused their dominant position in the market for UMTS-compliant baseband chipsets by supplying, during the period from 3 February 2009 to 16 December 2011, certain quantities of three of those chipsets to two of their key customers, Huawei and ZTE, below cost, with the aim of eliminating Icera, the appellants’ only competitor in that market during that period. On 15 August 2016, the appellants submitted their observations on the statement of objections.

9 On 30 January 2017, the Commission sent the appellants a request for information on the basis of Article 18(1) and (2) of Regulation No 1/2003. In the absence of a reply to that request for information, on 31 March 2017, the Commission adopted the decision at issue on the basis of Article 18(3) of the regulation.

10 Under Article 1 of the decision at issue, the appellants were to supply, within certain periods, the information specified in Annex I thereto, failing which they would incur, pursuant to Article 2 of that decision, a periodic penalty payment of EUR 580000 per day of delay. The appellants sent their answers to the questions put to them within the prescribed period, which had been extended by the Commission in the meantime.

The action before the General Court and the judgment under appeal

11 By application lodged at the Registry of the General Court on 13 June 2017, the appellants brought an action for annulment of the decision at issue, in support of which they put forward six pleas in law.

12 As a preliminary point, the General Court, in paragraphs 29 to 33 of the judgment under appeal, rejected as ineffective the complaint concerning the excessive duration of the administrative procedure, observing that such a complaint was irrelevant in examining an action concerning not a decision making a finding of infringement of Article 102 TFEU, but a decision requesting information.

13 That having been noted, the General Court, in the first place, rejected the third plea, alleging failure to state reasons for the decision at issue. In that regard, in paragraphs 47 to 54 of the judgment under appeal, the General Court held that, in so far as the decision at issue discloses clearly and unequivocally the presumed infringements which the Commission intended to investigate as well as why the information requested is necessary to assess the evidence in its possession in the light of the arguments put forward by the appellants following the issue of the statement of objections, the decision was adequately reasoned, since the Commission was not required to provide more detailed reasoning on how it intended to use that information for the purpose of examining those arguments.

14 In the second place, the General Court examined the first two parts of the first plea, alleging infringement of the principle of necessity. First, in paragraphs 69 to 91 of the judgment under appeal, the General Court rejected the first part of the first plea, seeking to find fault with the decision at issue in so far as it went beyond the scope of the investigation carried out as defined in the statement of objections, by requesting information relating to the chips of which the chipsets covered by the investigation are composed and concerning periods adjacent to the period of the infringement defined in that statement of objections. To that end, the General Court held, first of all, that, in order in particular to take account of the...