Monday, September 21, 2009

EU Actions Against Intel Continue

The European Commission on Monday continued to make its case against computer chip Intel by publishing a non-confidential version of a May decision, which carried a $1.45 billion fine for excluding competitors from the market for chips known as x86 central processing units. The documents, which include a summary of the key elements of the ruling, outline specific cases in which regulators believe Intel engaged in so-called conditional rebates and naked restrictions as well as how the firm allegedly sought to conceal its practices to disadvantage rival Advanced Micro Devices.

Intel reached an agreement with antitrust authorities in Japan but has appealed the European ruling and a similar decision in South Korea. The release of the Commission's analysis comes as Intel is being investigated in the United States by the FTC. The company has also faced scrutiny on Capitol Hill. Intel has argued that the model used overseas is worlds apart from the U.S. model and should not be seen as an indicator of how the FTC might proceed. Meanwhile, new Assistant Attorney General Christine Varney had vowed to reinvigorate antitrust enforcement in the Obama administration.

An Intel spokesman issued a strongly worded reaction, saying that there is nothing new in what the Commission released and its decision reflects "the underlying bias we have come to expect from the case team that ran this investigation." "We are convinced that the Commission's conclusions regarding our business practices are wrong, both factually and legally," he said, pointing out that the panel "relied heavily on speculation" and "ignored or minimized hard evidence of what actually happened."

AMD Executive Vice President Tom McCoy said "this is the first time Intel has had to confront now publicly available facts of its illegal behavior and it won't be the last." He added that the FTC investigation and a related probe by New York Attorney General Andrew Cuomo as well as AMD's civil case against Intel "will provide other clear demonstrations of Intel breaking the law."

Read the European Commission's document here and a recent National Journal story on the topic here (subscription required).