Broadcom to End Exclusivity Deals for Seven Years in EU Antitrust Deal

The European Commission launched an investigation into Broadcom in June 2019 and even threatened to issue an interim order.

By Reuters | Updated: 7 October 2020 18:01 IST

Broadcom to End Exclusivity Deals for Seven Years in EU Antitrust Deal

EU Commission Executive Vice-President Margrethe Vestager holds a news conference on Broadcom

Highlights

Broadcom makes chips to power smartphones, computers
In Europe, Broadcom won't offer price or non-price incentive to TV makers
The concessions are valid for seven years.

US chipmaker Broadcom will scrap its exclusivity deals with TV and modem makers in a deal with EU antitrust regulators aimed at ending a year-long investigation without a finding of wrongdoing, the European Commission said on Wednesday.

The European Commission launched an investigation into the company in June last year and even threatened to issue an interim order, its first in almost two decades, to stop such practices while the probe was ongoing.

Broadcom, which makes chips to power smartphones, computers and networking equipment and is a major supplier to Apple, subsequently offered to end its exclusivity deals.

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"Broadcom will suspend all existing agreements containing exclusivity or quasi-exclusivity arrangements and/or leveraging provisions concerning Systems-on-a-Chip (SoCs) for TV set-top boxes and Internet modems, and has committed not to enter into new agreements comprising such terms," the EU competition regulator said in a statement.

In Europe, Broadcom will not offer price or non-price incentives to TV and modem makers to buy a minimum number of its products nor tie such purchases to sales of other products.

On a worldwide level excluding China, it also pledged not to offer price or non-price incentives to TV and modem makers to buy more than 50 percent of its products nor tie such purchases to sales of other products for more than 50 percent of their products.

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The concessions are valid for seven years.

© Thomson Reuters 2020

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