Intel victory over €1bn fine poses problems for Brussels

Adjust Comment Print

Intel has won a small victory in its appeal against the Euro 1 billion competition fine levied against the company by the European Union in 2009.

"The case is referred back to the General Court in order for it to examine the arguments put forward by Intel concerning the capacity of the rebates at issue to restrict competition", the ECJ said.

In 2014 the EU's General Court had upheld the earlier antitrust decision - but, according to Bloomberg, the ECJ said the judges failed to properly analyze the economic aspects of the case.

The European Commission imposed the fine in 2009, finding that the USA - based microchip manufacturer abused its dominant position for the x86 CPU.

The commission said Intel foreclosed one of its competitors, Advanced Micro Devices Inc., from the market by granting rebates to four major computer manufacturers on the condition that they purchased all, or nearly all, of their x86 CPUs from Intel.

"The Commission takes note of today's ruling by the European Court of Justice (Case C-413/14 P) and will study the judgment carefully", a spokesperson for the European Commission said in an emailed statement.

Kate Middleton pregnant: Duke and Duchess of Cambridge expecting third child
Britain's Prince William and his wife Kate are expecting their third child , the Kensington Palace announced today. A change in law after William and Kate Wednesday gave women the same rights of accession to the throne as men.

"By undermining its competitors' ability to compete on the merits of their products, Intel's actions undermined competition and innovation", the Commission said at the time.

The General Court has been asked to further explore how Intel's customer rebates may have restricted competition. The ECJ has demanded that the case be re-examined by the lower court.

The CJEU has now ruled that the General Court was obliged to consider Intel's arguments on the point and to determine whether the Commission had applied the "as efficient competitor" (AEC) test correctly.

Regulators have generally frowned upon rebates, especially those offered by dominant companies, on the theory they are anti-competitive in nature. Intel had also paid a major electronics retail group, Germany's Media Saturn Holding, to only stock PCs with Intel inside. Intel has been appealing this fine for years and now the European Court of Justice has ordered that the case be revisited in a lower court.

The Court of Justice sidelined two other arguments by Intel, namely that the commission lacked territorial jurisdiction to penalize it, and that procedural irregularities affected its rights of defense.

Google, for instance, was issued with a record $2.7BN fine in June after the Commission decided - after a multi-year-long investigation - that its search comparison service, Google Shopping, had broken the bloc's competition rules by squeezing the visibility of rival price comparison services in organic search results while simultaneously foregrounding its own service.