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Intel CEO Paul Otellini arrives at the EC hearing building in Brussels to argue Intel's case.   (Source: REUTERS/Francois Lenoir)
Chipmaker continues to plead its innocence before the EU

The European Commission (EC), the executive arm of the European Union (EU), has already brought one mighty opponent to its knees.  It fined Microsoft almost $2.6B USD overall for antitrust violations, including fines of $690M USD and $1.4B USD.  Microsoft tried to refuse to comply with EC's verdict, but ended up paying for it even more in the end.

Now the EU is pursuing chipmaker Intel for allegedly employing anticompetitive practices such as a price slashing and illegal rebates to drive smaller chipmakers out of business.  The EU issued formal charges against Intel in July.  Intel responded quickly that the charges were nonsense and that AMD was the one complaining, not the customers.  AMD claimed that Intel reaped $60B USD in monopoly profits.

Intel fought back demanding a hearing before the EC where it could argue its viewpoint.  Meanwhile, Intel suffered another loss when its German offices were raided last month by EU agents, who seized documents applicable in the antitrust case.  Germany was one of the countries in which Intel is allegedly to have employed price manipulation and illegal rebates.

Now Intel has finally gotten its way, in effect, as it had a chance to plead its case before an EC hearing.  Intel's chief executive Paul Otellini travelled to Brussels to represent his company at the hearing.  Intel, whose chips are in four out of every five of the world's servers and PCs, has also been accused by the EC of paying off computer manufacturers to pick Intel chips over AMD chips.  Intel has denied these claims saying it competes fiercely and legally.

Mr. Otellini addressed Hearing Officer Karen Williams, arguing that Intel's financial practices were well within the law and that its success was from having a better product, not illegal maneuvers.  Ms. Williams will report to Competition Commissioner Neelie Kroes on the case at the end of the hearing. 

Commissioner Kroes, who recently championed the $1.4B USD fine against Microsoft, will make a final suggestion to the full European Commission about Intel's fate and the amount of a possible fine.  Fines can be up to 10% of a company's global revenue, under EU business law.  Commissioner Kroes previously stated that Intel may be a larger threat to E.U. business then Microsoft.  Following Commissioner Kroes statement, the EC will put the issue to a vote and come to a judgment.

Intel had most of the day yesterday to plead its case.   It discussed proprietary information during the hearing, requiring several participants to have to leave for extended periods.  The U.S. Federal Trade Commission and New York attorney general's office, who are investigating possible Intel antitrust violations within the U.S, were both represented.  It is expected that they may launch similar antitrust campaigns following in the EU's footsteps.

Today several consumer groups will have their chance to speak.  BEUC, a European umbrella group for consumer groups, and individual groups from the Netherlands, Spain and France will all be represented.  The groups so far have not come out with a firm stance on the allegations, but Monique Goyens, BEUC director general assured, "We may do so later."

She further stated that BEUC wants to ensure that consumer issues about pricing and innovation are properly examined and addressed.  AMD and Hewlett Packard are also both going to speak today.  Their accounts and testimony will be critical as their relationships with Intel figures heavily with the charges leveled against the chipmaker.

The EU, in addition to the Intel office raids, raided multiple retailers that sold only Intel chips and not AMD chips.  The materials gathered in these raids cannot be used in the hearing.  However the EC could elect to issue new charges against Intel at any point.  It did so three times during the Microsoft case, so such a result is not unexpected.



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RE: European Union...
By nofranchise on 3/12/2008 11:45:51 AM , Rating: 0
Awww I feel so sorry for Intel! Buuhuuuhuuhuu...

If you broke the law you are going to jail - or in this case pay a massive fine.

I almost choked on my coffee when I predicted correctly, that the first poster would give the usual ill informed "advice" about leaving Europe.

"Why you little socialist union you! Laws you say?! No laws apply to AMERICAN businesses! We come from the land of the free, where it is normal - and appreciated I might add - that corporations cheat, lie, subvert, bribe and own politicians. As long as it is done the American way, you just leave us alone."

Of course- what can you expect from a country who iwon't even recognise the International Criminal Court... I mean come on, Albania, Burundi and Mongolia are just some of the 150 countries ratifieing it.

The European Union is not anti-capitalist, it is anti-criminal-corporations. If you don't like the laws, get used to it, stop whining and ask the Guantanamo prisoners what they think about US law.


RE: European Union...
By pauluskc on 3/12/2008 12:16:07 PM , Rating: 4
geeeeeez. laws are laws. You are right. I am wrong. You are so right, it's amazing, really.

I could care less about Intel. I could care less about MS. I could care less about the EU. I could care less about the US.

All I cared about was the fines. Where do the fines go?


RE: European Union...
By nofranchise on 3/12/08, Rating: -1
RE: European Union...
By pauluskc on 3/12/08, Rating: -1
RE: European Union...
By mikeyD95125 on 3/12/08, Rating: -1
RE: European Union...
By michael67 on 3/12/2008 10:14:01 PM , Rating: 1
It is clear that Americans don't wane see other peoples views and only look at there own way of life as being the best.
And not even willing to listen to some one trying to explain how the system works by voting "nofranchise" explanation to -1

If you set your mind to that the other is wrong and your right you can never have a discussion.

you can also not see that some else's way of life isn't that bad and they are just people who dissuaded to live by other rules.

I see mouths more hatred to to the EU then the other way around.

And also the feeling we saved you in WOII you should be grateful.
Ware it was the french that actual one of the nations that helped the US to be a independent country.
And as a gift for celebrating your well earned freedom gave you your national symbol, the liberty statue.

I am not a fan of the french far from it but if i ware a 3th world country i would rather do business whit the french then the US,
Just because the french have a reputation in the world of after saying A also doing B even if it was done by the ope-side party, and even if its not convenient anymore.

A good example of what i mean is shown in the movie "Charlie Wilson's War" about the secret war against the communist in Afghanistan, and after spending billions of dollars to fight the bad commies and a incredible high dead toll on afghanis side,
The people there ware left to rot ware the US had the biggest chance in history to make it a real pro US/western oriented country.

The reason the US got suths a bad name in the world is, is because ass longs as my goal is the same as the US it will be my best friend but the moment its done you get dropped.

But whats the point of me trying to let see the other side when i for shore are going to be voted -1 because its not the popular point of view.


RE: European Union...
By afkrotch on 3/13/08, Rating: 0
"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer














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