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EU Broadcom Deal May Signal Trouble For Amazon, Apple & Google

 |  October 8, 2020

Laws and regulators sometimes create seismic shifts within industries – where new mandates and rulings on trade and competitive practices can be likened to a sledgehammer.

And then sometimes, change comes through what seems more like a scalpel approach. For Big Tech, the bleeding may come from cuts, here and there, targeting individual agreements and operations, reported PYMNTS.

To that end, in Europe, Margrethe Vestager, who serves as executive vice-president of the EU Commission, has said she would look to use more injunctions against Big Tech, tied at least in part to cases already underway.

As noted by The Wall Street Journal and other sites, the statements came after a settlement between the EU and chipmaking giant Broadcom.

Under the terms of that settlement, the EU has accepted Broadcom’s agreement not to craft any exclusivity pacts for chips that are used in television set-top boxes and modems through the next seven years.

But the real news, and the flare being sent up for Big Tech firms, is that the injunction “tool” (through a policy known as interim measures) had not been used in 18 years – and, as the Journal noted, effectively forced Broadcom to “suspend” the agreements with six other firms that had been under investigation.

An injunction represents a way to prohibit individual corporate actions – a scalpel approach to, ostensibly, stopping any (anti-competitive) harm that might occur before final regulatory or judicial opinions are rendered.

Vestager has said the injunctions would be more widely deployed as antitrust investigations continue into Google, Amazon, and Apple, among others.

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