On Friday 9 June, the European Commission decided to open an in-depth investigation into the proposed acquisition of NXP by Qualcomm, to ensure that the transaction does not lead to an increase in prices, less choice and less innovation in the field of semiconductors, which are used in most household devices.
Qualcomm is active in the semiconductor market, supplying integrated circuits (baseband chipsets) for use in mobile devices, enabling cellular telecommunications standards. NXP Semiconductors is present in the market for semiconductors for the automotive and mobile device industries. It is also a major supplier of NFC (near-field communication) chips and secure elements (SEs).
The Commission has concerns that the operation, which it was notified of on 28 April 2017, may affect competition in the semiconductor market for mobile devices. It is concerned that the merged entity would have the ability to exclude rival suppliers of baseband chipsets and NFC/SEs from these markets, and also to modify NXP’s current intellectual property licensing practices. If this is the case, the transaction may have anti-competitive effects on this market segment. Finally, the Commission considers that the planned transaction may also remove competition between companies active in the markets for semiconductors used in the automotive sector, particularly with regard to the future development of connected cars.
The European Commission now has until 17 October of this year to assess the planned acquisition of NXP by Qualcomm, in order to determine whether it would constitute a significant obstacle to competition on the semiconductor market for mobile devices. (Original version in French by Lucas Tripoteau)