EU regulator hits Intel microchip giant with anti-trust charges
Posted: 27 July 2007 1928 hrs

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BRUSSELS: The European Union's top regulator levelled on Friday formal anti-trust charges against Intel, the world's biggest computer chip maker, on suspicion that it had abused its dominant market position.

The regulator, the European Commission, said it had sent a "statement of objections" -- the first formal step towards possible fines -- to Intel on July 26 alleging that it had tried to exclude main rival AMD from the market.

"First, Intel has provided substantial rebates to various Original Equipment Manufacturers (OEMs) conditional on them obtaining all or the great majority of their CPU requirements from Intel," the Commission said in a statement.

"Secondly, in a number of instances, Intel made payments in order to induce an OEM to either delay or cancel the launch of a product line incorporating an AMD-based CPU (Computer Processing Unit).

"Thirdly, in the context of bids against AMD-based products for strategic customers in the server segment of the market, Intel has offered CPUs on average below cost," the statement said.

The Commission, which polices competition issues in the EU, said that the "three types of conduct reinforce each other and are part of a single overall anti-competitive strategy".

Brussels gave Intel ten weeks to respond, after which time it will have the right to an oral hearing. If its suspicions are confirmed, the Commission could impose a fine.

In reaction, Intel senior vice president Bruce Sewell said he was confident the US firm had done no wrong and was looking forward to respond to allegations made against it by AMD, also based in the United States.

"We are confident that the microprocessor market segment is functioning normally and that Intel's conduct has been lawful, pro-competitive, and beneficial to consumers," he said in a statement.

"While we would certainly have preferred to avoid the cost and inconvenience of establishing that our competitive conduct in Europe has been lawful, the Commission's decision ... means that at last Intel will have the opportunity to hear and respond to the allegations made by our primary competitor.

"The case is based on complaints from a direct competitor rather than customers or consumers," Sewell added. - AFP/ac