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[To Eurosmart members only]
Competition policy: Commission wants to facilitate support to the semiconductor industry
Today [18 November], the European Commission published a Communication on a competition policy fit for new challenges.
The Commission describes its successful results in its competition cases against gatekeepers. For instance, in July 2018, the Commission fined Google 4,34 billion euros for unlawful business practices relating to the Android operating system and apps. The Commission also required Broadcom to cease its practice of imposing exclusivity conditions on its customers of chips for modems and TV set-top boxes. The Commission’s efforts continue with ongoing cases against gatekeepers and the launch of a sector enquiry on Consumer IoT. Among other things, the Commission wants to ensure fair competition for access and use of data.
In addition, the Commission will update its 1997 Market Definition Notice. It is necessary to take into account digitalisation and new ways of offering goods and services. Market definition is extremely important as it enables the Commission to conclude whether a company holds a dominant position/monopoly within a given market.
At the same time, the Commission underlines that the competition policy should also allow reducing dependencies and increasing the resilience of the economy. Thus, the Commission has developed a competition compliance programme to guide the set-up of industrial alliances, such as the semiconductor alliance.
Moreover, the Commission is actively supporting Members States efforts to design a second Important Project of Common European Interest (IPCEI) on microelectronics. The overall objective is the enhance EU’s future competitiveness in the field of semiconductors, including through Horizon Europe and InvestEU. The Commission “may envisage approving public support to fill possible funding gaps in the semiconductor ecosystem for the establishment in particular of European first-state-of-a-kind facilities in the EU.” Such aid should be proportionate, and undue competition distortions should be minimised. The Commission also mentions the upcoming Chips Act.
The Commission insists on the need to ensure fair competition worldwide. However, fair competition “is unlikely to be the case in all jurisdictions”. “Openness requires fairness abroad as well as at home”. Therefore, the Commission is tackling the distortive effects of foreign subsidies.
Next steps
The Commission is in the middle of a review of its competition policy (see Annex I). This includes a review of the State aid framework on Important Projects of Common European Interest.
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