Intel wins $1bn antitrust fine appeal against the EU

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Intel has won its appeal against a $1bn antitrust fine charged against it by the European Commission more than 12 years ago.

The 2009 fine was brought against Intel for “abuse of a dominant market position” in which the Commission alleged the chipmaker had indulged in anti-competitive practices such as providing rebates to computer manufacturers to give itself an unfair advantage over rival AMD.

The General Court based in Luxembourg, the second highest in the EU, annulled in its entirety today (26 January) the case brought against Intel by the Commission, including the $1bn fine imposed.

“The analysis carried out by the Commission is incomplete and, in any event, does not make it possible to establish to the requisite legal standard that the rebates at issue were capable of having, or were likely to have, anticompetitive effects,” the court said in its judgement.

Intel got into trouble with the Commission when it offered rebates to computer manufacturers such as Dell, Acer, Hewlett-Packard and Lenovo, between 2002 and 2007, potentially blocking rival AMD’s ability to compete in the European chip market.

“Such rebates and payments effectively prevented customers, and ultimately consumers, from choosing alternative products”, the Commission said at the time. “By undermining competitors’ ability to compete on the merits of their products, Intel’s actions undermined competition and innovation.”

This is not the first time the General Court has ruled on the Intel v European Commission antitrust case. In 2014, the same court had upheld the Commission’s fine – only to be asked to review Intel’s side of the story by the EU Court of Justice, the highest, in 2017.

Antitrust regulators generally view rebates and other incentivising payments with suspicion as they can often lead to a stifling of competition and innovation in any sector. However, as in this case, regulators must find a clear link between the rebates and actual harm to competition.

Last year, Intel was ordered to pay $2.18bn to VLSI Technology by a Texas court in a patent infringement trial. VLSI, which was acquired by Philips in 1999, claimed that Intel had infringed on two of its patents relating to reducing power consumption in computer chips.

In November, the General Court upheld a €2.42bn antitrust fine given to Google in 2017 by the Commission following what it found was a breach of competition laws – marking a big win for Margrethe Vestager, the EU’s top commissioner responsible for competition who has been taking on Big Tech.

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