LONDON – Corning is facing European Union antitrust scrutiny after the bloc's watchdog said Wednesday it's investigating the speciality glass maker's exclusive deals for its Gorilla Glass used in cellphones.
The European Commission, the 27-nation EU's top antitrust enforcer, said it opened a formal investigation to determine whether Corning Inc. abused its dominant worldwide position for the toughened glass used in smartphones, tablets and other portable devices.
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The commission, which is the EU's executive branch, said it was concerned about “anti-competitive exclusive supply agreements" requiring device makers to source all or nearly all of their glass from Corning. Under these deals, manufacturers got rebates for buying only Corning glass, and could only take competing offers from rival glass makers if Corning couldn't match the price.
Strong competition "is crucial to ensure low prices and high-quality glass," said Margrethe Vestager, the commission's executive vice-president in charge of competition policy. “We are investigating if Corning, a major producer of this special glass, may have tried to exclude rival glass producers, thereby depriving consumers from cheaper and more break-resistant glass.”
Corning is “committed to compliance with all applicable rules and regulations where it does business,” the company said in a statement. "As part of that commitment, we work with local regulatory authorities to ensure open discussion and cooperation.”
Brussels has no deadline to wrap up the case, which could result in formal charges and a hefty fine worth up to 10% of the company's annual global revenue.