EU Signals More Antitrust Scrutiny of Tech After Broadcom Settles Dispute

Europe’s top competition official said she would make more use of injunctions, including in pending cases against big technology companies, after successfully forcing U.S. chip maker

Broadcom Inc.

AVGO 0.76%

to change its alleged anticompetitive practices.

The European Commission, the bloc’s top antitrust watchdog, on Wednesday said it was closing its probe and accepted Broadcom’s legally binding commitments to refrain from any exclusivity arrangements for chips used in television set-top boxes and internet modems over the next seven years.

Broadcom didn’t immediately comment on the settlement.

The decision comes a year after EU competition czar Margrethe Vestager revived so-called interim measures, an injunction that hadn’t been used since 2001, to order Broadcom to suspend the contested agreements while she was still investigating the case.

Ms. Vestager said she would make more use of this power as she investigates other companies for alleged antitrust violations, including

Alphabet Inc.’s

GOOG 0.47%

Google,

Apple Inc.,

Amazon.

AMZN 3.09%

com Inc. and

Facebook Inc.

In late July, the CEOs of Amazon, Apple, Facebook and Google faced tough questions and, at times, hostile criticism about their business practices during a U.S. House antitrust hearing. The session highlighted how four of America’s five most valuable companies are under scrutiny from both sides of the aisle. Photo: U.S. House Judiciary Committee/Reuters

“If you have taken out a tool out of a toolbox and have some experience in using it, it’s more likely that you’ll use it again,” she said.

Ms. Vestager has gained notoriety in recent years for leveling record multibillion-dollar penalties on Google and Apple. But those cases started over a decade ago and are still being fought in EU courts, with plaintiffs alleging that their services are still being discriminated against in Google searches.

Her reputation suffered a blow in July when the EU’s second-highest court sided with Apple over a €13 billion tax bill, a ruling Ms. Vestager is now challenging in the EU’s top court.

“Effective competition may not always be best achieved by imposing fines,” Ms. Vestager said Wednesday. “Interim measures prevent irreparable harm from happening while the commission is investigating the case,” she said, noting that the Broadcom case was completed in under a year.

Ms. Vestager’s stance on big technology companies using their dominant position to quash competitors was seconded Tuesday by a Democratic-led report issued by the U.S. House of Representatives.

“I think it’s proof of one of the things I’ve said a number of times, that the debates have changed a lot on the other side of the Atlantic in the time where I have been dealing with competition law enforcement,” Ms. Vestager said, adding that she had sent two submissions to the House probe. “There is some similarity in the way we think about this.”

Write to Valentina Pop at [email protected]

Appeared in the October 8, 2020, print edition as ‘Europe Signals More Scrutiny Of Tech Companies.’