The European Commission has launched an antitrust investigation into Corning Inc., the U.S.-based glass manufacturer, to assess whether it may have abused its dominant market position by restricting competition in the global market for alkali-aluminosilicate glass (known as “Alkali-AS Glass”), primarily used in mobile device screens. Corning’s glass, sold under the “Gorilla Glass” brand, is widely recognized for its break-resistance and is popular among manufacturers of mobile phones, tablets, and smartwatches.
The Commission is examining whether Corning engaged in anti-competitive practices through exclusive agreements with both mobile device manufacturers (OEMs) and glass finishing companies. Key areas under scrutiny include:
- Exclusive Supply Agreements with OEMs: Corning allegedly required OEMs to source all or nearly all of their Alkali-AS Glass exclusively from Corning, potentially limiting options for device makers and reducing consumer choice.
- Exclusivity Rebates: The company allegedly provided rebates to OEMs on the condition that they adhere to these exclusive sourcing terms.
- “English Clauses”: Under these provisions, OEMs must inform Corning of competing offers, allowing Corning the opportunity to match prices, potentially stifling price competition.
- Agreements with Glass Finishers: Corning is also reported to have included exclusive purchase obligations and “no challenge” clauses, which may have deterred finishers from purchasing glass from other suppliers or challenging Corning’s patents.
The Commission voiced concerns that these practices may limit competitors’ access to the market, thereby restricting competition, reducing consumer choice, potentially increasing prices, and slowing innovation in screen glass technology. Such actions, if proven, could breach Article 102 of the Treaty on the Functioning of the European Union (TFEU), which prohibits abuse of a dominant market position.
Margrethe Vestager, Executive Vice-President for Competition Policy, emphasized the impact on consumers, noting, “It is very frustrating and costly to break a mobile phone screen. Strong competition in producing cover glass is essential to ensure affordable, high-quality options. We are investigating if Corning may have tried to exclude rival producers, potentially depriving consumers of more affordable and durable glass alternatives.”
While the investigation progresses, Corning may submit commitments to address the Commission’s concerns. There is no fixed timeline for concluding the investigation, as its length will depend on the complexity of the case and the level of cooperation from Corning.
Source: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_5681
