Intel Spars With EU Regulators Over $421.4 Million Antitrust Fine

Intel Spars With EU Regulators Over $421.4 Million Antitrust Fine

Intel, the U.S. chipmaker, is contesting a 376 million euro ($421.4 million) fine imposed nearly two years ago by EU antitrust regulators for allegedly excluding rivals from the market between 2002 and 2006.

According to Intel, the fine is disproportionate and unfair, claiming the violations related to HP, Acer, and Lenovo were narrow and tactical, not part of an overall market strategy.

The case dates back to 2009, when the European Commission slapped a then-record 1.06 billion euro fine on Intel for blocking rival Advanced Micro Devices, but the tech giant managed to convince the General Court, Europe's second-highest, to scrap the penalty in 2022.

Judges, however, agreed with one part of the Commission's 2009 decision. As a result, the EU competition watchdog re-imposed a 376 million euro fine for payments made by Intel to HP, Acer, and Lenovo to halt or delay rival products between November 2002 and December 2006.

Such practices are known as naked restrictions. Antitrust regulators strictly prohibit this.

Intel then took its case back to the General Court, asking for the new EU decision and penalty to be annulled.

Intel's lawyer said the EU competition enforcer had not taken into account the limited scope of the violations related to HP, Acer, and Lenovo.

"The Commission cannot sustain a finding that there was an overall strategy to foreclose competitors from the entire x86 chips market. These were narrow, tactical moves," Daniel Beard told the panel of five judges.

"The naked restrictions can't be treated as in effect of equal weight to each of the pricing practices which were overturned. Nor do they have the same sort of cumulative effect or strategic weight. They, on their own, don't sustain an overall, market-wide strategy finding," he said.

Beard said the Commission had imposed "a wholly disproportionate and unfair" fine.

The EU watchdog rejected Intel's arguments.

"The Commission correctly applied the finding guidelines, and when in doubt, opted in Intel's favour," its lawyer Pedro Caro de Sousa said.

"The fine is clearly not disproportionate to the seriousness of Intel's conduct, amounting to 1% of its turnover on the last year of the infringement, and about 0.5% of its turnover today," he said.

Both Intel and the Commission called on the court to resolve the issue by setting the size of the fine. A ruling is expected in the coming months.