Intel contests EU on $1.45 billion fine

European regulators' decision in May to levy a billion-dollar penalty did not meet the necessary "standard of proof," the chipmaker says.

This was originally posted at ZDNet's Between the Lines.

Intel said Europe's top antitrust regulator failed "to meet the required standard of proof" when it fined the chipmaker $1.45 billion in May for anticompetitive behavior against Advanced Micro Devices. (The news comes as Apple named Intel's top lawyer Bruce Sewell as its general counsel.)

Intel noted that it would appeal, and the company recently laid out its case against the European Commission, the administrative wing of the European Union. In a nutshell, Intel argues that the EC:

• Failed to address evidence that AMD was increasing market share during the period in question;
• Failed to establish a causal link between Intel's discounts and customer decisions not to use AMD;
• Failed to analyze how those discounts impacted consumers at all;
• And failed to stick to legal procedures as it decided to fine Intel.

The stakes are high, as AMD cited the EC fine as a big win. A key passage from the appeal:

The Commission fails to prove that Intel's rebate arrangements were conditional upon its customers purchasing all or almost all of their x86 CPU requirements from Intel. In addition, the Commission uses an 'as efficient competitor' ('AEC') test to determine whether Intel's rebates were capable of restricting competition but it commits numerous errors in the analysis and assessment of the evidence relating to the application of that test. The Commission also fails to address other categories of evidence relevant to the effects of Intel's discounts.

The company is asking that the EC decision be nixed completely, "annul or reduce substantially the level of the fine imposed" and pay Intel's legal costs.

About the author

    Larry Dignan is editor in chief of ZDNet and editorial director of CNET's TechRepublic. He has covered the technology and financial-services industries since 1995.

     

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