Millions of Britons could be entitled to £482.5m in damages from chipmaking tech giant Qualcomm for overcharging consumers for Apple and Samsung smartphones, according to the Consumer Association’s Which?.
The consumer watchdog charity believes Qualcomm breached UK competition law by abusing its dominance in the patent-licensing and chipset (electronic components used in smartphones) sectors, charging phone manufacturers inflated fees for technology licences in a cost that is passed down to the buyer.
The group estimates that around 29 million Britons could be entitled to between £5 and £30 depending on the number and type of Apple or Samsung handsets they’ve purchased since 1 October 2015, although it anticipates the majority of consumers would receive around £17 each.
The i newsletter latest news and analysis
Which? is taking legal action against the tech company on behalf of UK consumers, alleging that Qualcomm refuses to license its patents to other competing chipset manufacturers or to supply chipsets to manufacturers such as Apple and Samsung unless those companies obtain a separate licence and pay substantial royalties to Qualcomm.
Consequently Qualcomm is able to charge phone manufacturers higher fees for the use of its patents, using its considerable market power to charge artificially high fees for its patents, the group added.
Which?’s claim will automatically include consumers that purchased particular phone models either directly from the manufacturer, network operator or smartphone retailer.
The case must be won in a Competition Appeal Tribunal before any compensation can be paid, although Which? is urging the company to settle the claim without the need for litigation and agree to pay consumers their money back.
Which? recommends consumers check www.smartphoneclaim.co.uk to find out more about the campaign and to sign up for updates
Qualcomm has been investigated for anti-competitive practices around its licences in other countries, and has been ordered to pay out billions of dollars to authorities in the European Union (EU), China, South Korea and Taiwan in 2018, 2015, 2016 and 2018 respectively.
The company admitted that the EU was investigating whether it had engaged in anti-competitive behaviour by leveraging its market position in 5G modem chips in the radio frequency chip market in a regulatory filing in February last year.
Qualcomm has been contacted for comment.
Anabel Hoult, chief executive of Which?, said: “We believe Qualcomm’s practices are anticompetitive and have so far taken around £480 million from UK consumers’ pockets – this needs to stop.
“We are sending a clear warning that if companies like Qualcomm indulge in manipulative practices which harm consumers, Which? is prepared to take action.
“If Qualcomm has abused its market power it must be held to account. Without Which? bringing this claim on behalf of millions of affected UK consumers, it would simply not be realistic for people to seek damages from the company on an individual basis – that’s why it’s so important that consumers can come together and claim the redress they are entitled to.”