backtop


Print 116 comment(s) - last by iFX.. on May 27 at 5:02 PM

Fine is the largest ever levied for antitrust violations in the EU

Intel is the largest CPU maker in the world and dominates the market in many categories. Allegations were made against Intel in Europe that the company was using its dominant market position to reduce competition and prevent AMD from gaining market share.

DailyTech
has been following the EU investigation into Intel closely. This week allegations against Intel were outlined that claimed the chipmaker offered computer makers discounts and incentives to not use AMD products and to cancel AMD products in development.

The New York Times reports that The European Commission has now ruled against Intel and fined the massive chipmaker $1.45 billion. The fine is the largest ever levied against a company by the Commission and eclipses the fine that Microsoft paid to the EU for anticompetitive practices by about two times.

The EU competition commissioner Neelie Kroes says that the massive fine was justified because Intel has denied consumers a choice for CPUs in products. Kroes told the NYT, "[Intel used] used illegal anticompetitive practices to exclude its only competitor and reduce consumers’ choice — and the whole story is about consumers."

Intel CEO Paul Otellini said the firm would appeal the decision. Otellini said, "We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace. There has been absolutely zero harm to consumers."

AMD's Giuliano Meroni, president of European operations said, "[The decision would] shift the power from an abusive monopolist to computer makers, retailers and above all PC consumers."

Kroes also says that Intel went to great lengths to cover up its anticompetitive actions. Part of the ruling against Intel also forces the company to immediately stop offering computer makers rebates that are part of the reason Intel maintains an 80% market share in Europe.

Intel must change these practices immediately pending appeal though it can ask for an injunction. The $1.45 billion fine has to be paid immediately, but will be placed into an account and held until all of Intel's appeals are exhausted. The appeals process could reportedly last for years.

The amount of the fine levied against Intel is certainly massive, but the NYT says it could have been even larger. The European Commission can levy fines as high as 10% of the company's total revenue. With sales of $37.6 billion in 2008, the fine could have reached nearly $4 billion.

Fines collected by the commission are added to its budget, which is around €130 billion reports the NYT. Kroes said, "Now they [Intel] are the sponsors of the European taxpayers."

The huge fine will also serve as a warning to other companies facing investigation by the commission. Regulators in the EU are some of the strictest enforcers of antitrust law in the world. The NYT reports that the EU is so much tougher on antitrust that U.S. firms often file allegations in Europe rather than in America. Intel is also facing inquiries in the U.S. from the FCC over similar allegations.



Comments     Threshold


This article is over a month old, voting and posting comments is disabled

Who sponsors whom
By crystal clear on 5/13/2009 9:46:22 AM , Rating: 1
quote:
"Now they [Intel] are the sponsors of the European taxpayers."


It should read "Now Intel are the sponsors of tomorrow for the European Commission expenses.

Eat,drink & enjoy cause Intel will be paying the bills.....




RE: Who sponsors whom
By BZDTemp on 5/13/2009 3:13:13 PM , Rating: 2
quote:
quote: "Now they [Intel] are the sponsors of the European taxpayers."


Big whoop!

The fine comes to less than three US dollars per EU citizen. Like that really matters.


RE: Who sponsors whom
By iFX on 5/13/2009 3:21:02 PM , Rating: 1
You're right. Stealing 1.45 billion dollars doesn't matter.


RE: Who sponsors whom
By mars777 on 5/13/2009 4:57:07 PM , Rating: 2
You're probably right.
Because breaking laws is allowed, fining for breaking laws is like stealing.


RE: Who sponsors whom
By crystal clear on 5/13/2009 8:40:11 PM , Rating: 2
YES indeed when the prosecuting attorney is also the judge.


RE: Who sponsors whom
By mars777 on 5/15/2009 4:28:39 PM , Rating: 2
I think it really doesn't matter.

A child that can read a book about monopolistic practices could be the judge, prosecution attorney and defendant attorney.

The result would be the same.


RE: Who sponsors whom
By iFX on 5/27/2009 5:02:56 PM , Rating: 2
A conflict of interest matters as much as the so called anti-competitive practices Intel has been accused of.

Basically, you can't call someone on an ethics violation and then commit one yourself. A child could read an ethics book and understand that.


RE: Who sponsors whom
By crystal clear on 5/13/2009 8:09:31 PM , Rating: 1
YES it does matter-Its big money for a company that works very hard to earn it.

Raise taxes by 3 dollars per EU citizen in the EU to sponsor the EU commission.


"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings

Related Articles













botimage
Copyright 2014 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki