Intel appeals €1bn EU antitrust fine from 2009

Decision seen as major setback to competition watchdog

EU antitrust enforcers in 2009 said Intel tried to block AMD by giving rebates to computer makers Dell, Hewlett-Packard, NEC and Lenovo for buying most of their chips from Intel.

EU antitrust enforcers in 2009 said Intel tried to block AMD by giving rebates to computer makers Dell, Hewlett-Packard, NEC and Lenovo for buying most of their chips from Intel.

 

Intel on Tuesday said European Union antitrust regulators got it wrong when they fined the chipmaker €1.06 billion more than a decade ago for thwarting a British rival in a case that could affect Google and Qualcomm.

The US company set out its arguments at the General Court in a re-hearing of a case seen as testing the European Commission’s power to go after US tech giants that offer incentives such as rebates to lure customers from competitors.

EU antitrust enforcers in 2009 said Intel tried to block Advanced Micro Devices by giving rebates to computer makers Dell, Hewlett-Packard, NEC and Lenovo for buying most of their chips from Intel.

The General Court is hearing the case for the second time after the EU Court of Justice (ECJ), Europe’s highest court, in 2017 disagreed with its 2014 ruling backing the commission’s decision in what was a major setback to the EU competition watchdog.

It told the lower tribunal to re-examine the case and whether exclusivity rebates actually harmed competition. The commission’s decision was fundamentally flawed, Intel’s lawyer Daniel Beard told the panel of five judges.

“The commission either took a wrong approach in its decision or it carried out an ‘as efficient competitor’ [AEC] test and it got it wrong,” he said. An AEC test is an economic analysis that determines if a dominant company knocks out competitors that are as efficient or more efficient through anti-competitive practices. Pushing out a less efficient rival may not be problematic for regulators.

Commission lawyer Nicholas Khan criticised Intel for seeking to reopen the entire case. “That was assessed very exhaustively in 2014. Intel’s request is a second bite at the cherry,” he told judges.

The Association for Competitive Technology is supporting Intel, while French consumer body UFC is backing the commission. A judgment is likely to come next year though the losing party can appeal to the ECJ.

Qualcomm has challenged a €997 million EU fine for paying iPhone maker Apple to use only its chips, blocking out rivals such as Intel. Alphabet unit Google has also challenged a record €4.34 billion EU antitrust fine levied for using its Android mobile operating system to squeeze out rivals. – Bloomberg