Intel faces new EU antitrust charges

Intel will soon be slapped with more antitrust charges by the European Commission, according to a source close to the situation.

The European Commission is about to slap new antitrust charges on Intel, this time for trying to squeeze rival chip maker Advanced Micro Devices out of some of Europe's most important technology retail stores, according to a person familiar with the situation.

A second "statement of objections" is likely to be sent to Intel in the coming days. At the same time, charges may also be leveled against some of the retailers, such as German group Metro, owner of Media Markt, the biggest electronics chain store in Europe.

"It could happen as soon as tomorrow," the person said on condition of anonymity.

In February the Commission launched surprise visits -- often referred to as dawn raids -- on Intel's offices in Munich; the offices of Europe's largest electrical and electronic goods retailers, Media Markt in Germany, Italy, Hungary and Poland; on DSG International in the UK, and French retailer PPR.

The Commission said at the time that it conducted the raids because it suspected Intel and the retailers of violating laws banning restrictive business practices.

Concerns about Intel's relationship with the leading electronics retailers date back a number of years, but the Commission only opened an investigation in 2006 after it received a complaint from AMD, Intel's only significant rival.

The Commission said at that time that it suspected Intel of pressuring Media Markt not to stock PCs fitted with AMD chips. Media Markt operates more than 460 stores spread across 11 countries in the European Union, and is a vital distribution channel for the computer industry.

The person close to the Commission's investigation said these suspicions have been confirmed.

The new statement of objections comes a year after the Commission, Europe's top antitrust authority, charged Intel of handing out "substantial rebates" to computer manufacturers if they buy most of their x86 CPUs (computer processing units) from Intel.

The Commission also accused the company of paying computer makers for scrapping or delaying the launch of machines fitted with AMD chips, and of selling its chips for server computers at below cost to large customers such as governments and universities.

Intel has consistently argued that it is competing hard but fair in a very competitive industry.

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Paul Meller

IDG News Service
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