Commission takes aim at chipmaker Intel

The European Commission has formally accused Intel, a US computer processor-maker, of anti-competitive practices to limit the market share of its largest rival AMD.

In a formal statement of objections (SO) sent on Friday (27 July) the Commission accused Intel of selling processors to computer equipment-makers below cost and offering special rebates to them to win business and to induce them to delay or cancel the launch of products using AMD chips.

The Commission accused Intel of giving rebates to equipment-makers to reward them for buying most of their processors from the company. It also said that Intel had paid computer-makers to delay or cancel the launch of a product line using AMD processors. The company had also offered processors below cost to big customers in the server market, according to the Commission.

Bruce Sewell, an Intel senior vice-president, said: "Intel’s conduct has been lawful, pro-competitive, and beneficial to consumers." He said that while the company would have preferred to avoid the cost and inconvenience of defending itself against the Commission’s accusations, the decision to issue a statement of objections meant that "Intel would have the opportunity to hear and respond to the allegations made by our primary competitor".

Thomas McCoy, vice-president for legal affairs at AMD, said: "Intel has circled the globe with a pattern of conduct, including direct payments, in order to enforce full and partial boycotts of AMD. The EU action obviously suggests that Intel has, once again, been unable to justify its illegal conduct."

The Commission’s decision to issue a statement of objections follows an inquiry lasting several years into accusations that Intel was offering incentives to limit AMD’s market share.

Intel has ten weeks to respond to charges and defend its behaviour. If the Commission does not accept its arguments, it can fine the company up to 10% of its turnover and order the company to stop or change its practices.

The European Commission has formally accused Intel, a US computer processor-maker, of anti-competitive practices to limit the market share of its largest rival AMD.