The European Union has opened an investigation into alleged anti-competitive practices by Broadcom.
The commission will assess whether Broadcom has enforced exclusivity agreements to leverage its position and block competitors. In particular, the investigation will look at Broadcom chipsets for set-top boxes and modems.
While the investigation is ongoing, the EU says that it intends to impose ‘interim measures’ to ban the alleged exclusivity.
In its statement, the commission said that the gathered information indicates that Broadcom’s practices may include: setting exclusive purchasing obligations; granting rebates or other advantages conditioned on exclusivity or minimum purchase requirements; product bundling; abusive IP-related strategies; and deliberately degrading interoperability between Broadcom products and other products.
Margrethe Vestager, commissioner in charge of competition policy, said: “TV set-top boxes and modems are part of our daily lives, for both work and for leisure. We suspect that Broadcom, a major supplier of components for these devices, has put in place contractual restrictions to exclude its competitors from the market. This would prevent Broadcom’s customers and, ultimately, final consumers from reaping the benefits of choice and innovation.
“We also intend to order Broadcom to halt its behaviour while our investigation proceeds, to avoid any risk of serious and irreparable harm to competition.”
In response to the allegations, Broadcom wrote a filing with the Securities and Exchange Commission that said the company “believes it complies with European competition rules and that the commission’s concerns are without merit.”
This is not the only regulatory scrutiny facing Broadcom. The company is also under investigation from the FTC in the US over similar anti-competitive practices with its Wi-Fi and Ethernet chips.
The commission said that investigation will be carried out “as a matter of priority”.
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