Intel examining options after Euros 376 million fine for anti-competitive practises
16/10/2023
Intel, the American multinational corporation and technology company, is considering its options after the European Commission (EC) re-imposed a fine of €376.36m ($400m) on the high profile chip manufacturer for anti-competitive practices.
According to the European regulator, Intel violated EU antitrust laws between November 2002 and December 2006 by using anti-competitive practices to eliminate rivals from the market. Action was taken under Article 102 of the Treaty on the Functioning of the European Union and Article 54 of the European Economic Area Agreement to prohibit the abuse of a dominant position.
In 2009, the EC imposed €1.06bn fine on Intel for abusing its position in the market for x86 CPUs. Last year, the General Court partially annulled the EC’s 2009 decision and negated the €1.06bn fine imposed on Intel.
The court, however accepted that Intel had illegally blocked competitors from the market. The EC alleged Intel paid computer manufacturers to prevent or delay the release of specific products with x86 CPUs made by competitors and to restrict the distribution channels open to these product.
Following the 2022 GC finding that the ‘naked restrictions’ were illegal, the EC re-imposed a fine of €376.3 million.
EC Commissioner Didier Reynders said: “We are re-imposing a €376.36m fine on Intel for having abused its dominant position in the computer chips market.
“Intel paid its customers to limit, delay or cancel the sale of products containing computer chips of its main rival. This is illegal under our competition rules.”
Intel said it is weighing its options, telling Reuters :“We are analysing the decision and the amount of the fine to determine the possible grounds and prospects of success of an appeal to the European Courts.”
The fine comes as Intel are awaiting EC approval for nearly €10bn in German state aid, which will be used to build a semiconductor facility in Germany. Another ongoing issue is that Intel made a €593 million claim for repayment of interest (plus interest) on the €1.06 billion provisionally paid to the commission.
Directors and officers could face litigation from shareholders who are disgruntled at the company receiving a significant fine, with allegations of wrongful acts likely to lead to significant legal defence costs and potentially expensive damages awards also. W Denis Europe arrange Management Liability Insurance for a wide range of businesses throughout the EU. For more information, or a quotation, please contact W Denis:
Eastern Europe
Southern Europe
Christos.Hadjisotiris@wdenis.com
Western Europe &/or elsewhere worldwide