European Union top court orders reexamination of Intel antitrust fine

Posted September 08, 2017

The EU General Court (EGC) [official website] previously found [WP report] in 2014 that Intel had violated EU competition law by using rebates to suppress computers using rival company AMD's [corporate website] chips in the European market.

The Court of Justice ruled that the lower court had failed to examine "whether the rebates at issue were capable of restricting competition".

The Commission had imposed the fine in May 2009 claiming that the U.S. manufacturing giant which employs thousands of people in Leixlip, had abused its dominant position in the microchip market.

In its ruling Wednesday, the CJEU agreed with Intel.

The decision, which was hotly anticipated, could have potential implications for Qualcomm, a similar case involving rebates and Google, which is expected to announce its appeal of the massive Euro 2.4 billion fine imposed on the company by the EU Commission this year.

More news: Fed's Fischer first to flee from Trump administration, Yellen not far behind
More news: WVU falls to Virginia Tech 31-24
More news: Thibaut Courtois brings the amusing with reaction to Diego Costa latest

The decision signals that dominant companies' use of rebates aren't de facto problematic, meaning that regulators may now have to prove in each case that the rebate measures offered cause economic harm.

While CURIA's ruling potentially opens the door for Intel to have the fine reduced or even written off in its entirety the company also had other arguments fully dismissed: Intel's claims that the EU Commission lacked territorial jurisdiction to fine a United States company and allegations of procedural irregularities that affected the company's rights of defence were both rejected by CURIA.

In June the Commission hit Google with a €2.4bn fine over its online shopping services.

"The Court therefore sets aside the judgment of the General Court as a result of that failure", the ECJ said on Wednesday. Intel offered rebates to compuer manufacturers in return for buying at least 95% of their chips from Intel. In its ruling, the court decided this case was such that the AEC test should in fact be properly evaluated by the General Court, and deferred the case back.

Firstly Intel gave rebates to computer vendors on the condition that they bought their x86 processors from the chip maker and made direct payments to one major retailer on the condition that only stocked PCs with Intel chips. "Exclusivity rebates are no longer considered in the European Union as inherently anticompetitive". The tech company then brought an appeal against the General Court's judgment before the Court of Justice.