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European Antitrust Officials Raid Intel Offices

by Rainier on July 12, 2005 @ 1:36 p.m. PDT

A spokesman for the European Union executive said that European offices of US Chipmaker Intel Corp., computer makers and distributors were raided by European Commission and local authorities on Tuesday as part of an investigation into possible antitrust violations, filed by AMD a few weeks ago.

The Commission's escalation came as Intel's smaller rival, Advanced Micro Devices, was trying to ratchet up pressure on the chip maker, which has 90 percent of world sales of microprocessors for personal computers that run Microsoft Windows and Linux.

"(EU) competition officials, accompanied by officials from national competition authorities, are conducting inspections of several premises of Intel Corp. in Europe as well as a number of IT firms manufacturing or selling computers," Commission spokesman Jonathan Todd said.

"The investigations are being carried out within the framework of an ongoing competition case," he added.

Intel confirmed the raids and said that it was cooperating fully with the Commission.

"As is our normal practice, we are fully cooperating with authorities from the EU. Beyond that, we can't comment on the specifics of the searches but we believe our business practices are both fair and lawful," said spokesman Chuck Malloy at the company's Santa Clara, California, headquarters.

Sources familiar with the situation said that the raids included Intel's installations in Swindon, England, and in Munich.

Japan has also acted against Intel, but U.S. authorities have expressed little interest in becoming involved. Antitrust authorities in the United States have said that abuse of dominance or monopolisation cases are their lowest priority, after cartels and mergers.

The Commission had let a probe it began four years ago go dormant until AMD offered new information more than a year ago.

"We welcome today's dawn raid concerning Intel's continuing infringement of European competition rules. AMD has worked with the EU Commission for years and submitted growing evidence of Intel's illegal activities, including materials from third parties," the spokesman said.

The raids in Europe are only one of the fronts on which Intel is facing pressure.

AMD has argued to competition authorities around the world, and recently filed lawsuits, alleging that Intel maintains a 90 percent market share by income and 78 percent market share by volume by violating antitrust laws.

AMD filed a triple-damages antitrust lawsuit in the United States earlier this month, alleging that Intel had used threats and kickbacks in illegally building the world's top computer chip business.

AMD argues that Intel coerced 38 companies, including Dell Inc.and Sony Corp.

A spokeswoman for Dell in the UK confirmed that the group's headquarters in Bracknell in southern England had been visited by EU officials.

"We have been visited by officials .... and we are cooperating fully with them," she said, adding that no further details could be provided at the moment.

Last month, AMD filed two suits against Intel in Japan, seeking $55 million in damages from the world's largest chip maker for alleged violations of the country's antitrust laws.

In March, Japan's Fair Trade Commission (FTC) found that Intel had violated antitrust laws by offering rebates to five PC makers that agreed either not to buy or to limit their purchases of chips made by AMD or other rivals.

The five computer makers were Hitachi, Sony, NEC, Fujitsu and Toshiba.

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