The European Union has reimposed a fine of €376.36 million ($400 million) on Intel for antitrust violations dating back to the early 2000s. This fine follows a previous one in 2009, where Intel was fined over a billion euros for abusing its dominance in the chip market to exclude rival AMD.
Key Takeaway
The European Union has reimposed a fine of €376.36 million ($400 million) on Intel for antitrust violations dating back to the early 2000s. The violations include Intel paying PC makers to delay or cancel products containing rival x86 CPUs, thereby limiting consumer choice and competition in the market.
Background
Intel’s antitrust case has been ongoing for years, with the company filing legal appeals against the initial fine. While some appeals are still ongoing in 2023, one element of Intel’s case is no longer being appealed, leading to the EU reimposing a smaller fine specifically for that element.
Specific Violations
The EU’s General Court ruled last year that Intel’s “conditional rebates” were partly annulled but confirmed the unlawfulness of Intel’s “naked restrictions.” The “naked restrictions” refer to Intel paying PC makers to delay or cancel products containing rival x86 CPUs and limiting the sales channels for these products. The specific violations for which Intel is being fined include:
- Between November 2002 and May 2005, Intel made payments to HP conditional upon HP selling business desktops based on AMD CPUs only to small- and medium-sized enterprises, only via direct distribution channels, and by postponing the launch of its first AMD-based business desktop in Europe by 6 months.
- Intel made payments to Acer conditional upon Acer postponing the launch of an AMD-based notebook from September 2003 to January 2004.
- Intel made payments to Lenovo conditional upon Lenovo postponing the launch of AMD-based notebooks from June 2006 to the end of 2006.
These restrictions had a detrimental effect on competition by depriving customers of a choice they would have otherwise had, according to the Commission.
Reimposed Fine
The amount of the fine, €376.36 million, is based on the same parameters as the 2009 decision but reflects the narrower scope of the infringement being considered. While the EU is still appealing the General Court’s ruling on Intel’s conditional rebates, the Commission is committed to ensuring that anticompetitive practices are not left unsanctioned.
Last year, the EU’s top court also ruled that the Commission must pay default interest on reimbursed fines in annulled antitrust cases. Intel has filed a claim for €593 million in interest from the EU, which is currently pending a final decision from the Court of Justice. The EU has also proposed amendments to the Financial Regulation to ensure fines provisionally paid and later annulled or reduced are reimbursed with interest.
Despite the limited impact of the infringement in the European Economic Area and the time that has passed since the violations occurred, the EU remains committed to enforcing competition rules and sanctioning anticompetitive practices.
