EU charges Samsung with abusing vital telecoms patent

BRUSSELS Sat Dec 22, 2012 12:30am IST

Samsung flags are set up at the main entrance to the Berlin fair ground before the IFA consumer electronics fair in Berlin, August 28, 2012. REUTERS/Tobias Schwarz/Files

Samsung flags are set up at the main entrance to the Berlin fair ground before the IFA consumer electronics fair in Berlin, August 28, 2012.

Credit: Reuters/Tobias Schwarz/Files

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BRUSSELS (Reuters) - The European Commission charged Samsung Electronics (005930.KS) on Friday with abusing its dominant position in seeking to bar rival Apple (AAPL.O) from using a patent deemed essential to mobile phone use.

The Commission sent a "statement of objections" to the South Korean group, with its preliminary view that Samsung was not acting fairly.

"Intellectual property rights are an important cornerstone of the single market. However, such rights should not be misused when they are essential to implement industry standards, which bring huge benefits to businesses and consumers alike," Competition Commissioner Joaquin Almunia said in statement.

Apple and Samsung, the world's top two smartphone makers, are locked in patent disputes in at least 10 countries as they vie to dominate the lucrative mobile market and win over customers with their latest gadgets.

The filing of competition objections is the latest step in the Commission's investigation. After notifying Samsung in writing, the company will have a chance to reply and request a hearing before regulators.

If the Commission then concludes that the firm has violated the rules, it could impose a fine of up to 10 percent of the electronics firm's total annual turnover.

Technology companies are increasingly turning to the European Commission as the European Union's competition authority, to resolve their disputes. The Commission is also investigating Google (GOOG.O) and Microsoft (MSFT.O).

In the case of Samsung, its standard-essential patents (SEPs) relate to the EU's 3G UMTS standard. When this was adopted in Europe, Samsung committed to license the patents fairly to competitors, the Commission said.

However, it began seeking an injunction in 2011 in various EU member states against Apple's use of these patents. The Commission opened its investigation in January 2012.

Samsung said it was studying the Commission's statement. It said it would cooperate fully and "firmly defend ourselves against any misconceived allegations".

"Samsung is confident that, in due course, the Commission will conclude that we have acted in compliance with European Union competition laws."

(Reporting By Philip Blenkinsop and Barbara Lewis; Editing by Helen Massy-Beresford and Mike Nesbit)

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