www.nytimes.com/2009/05/14/business/global/14compete.html
Intel a record 106 billion euros Wednesday for abusing its dominance in the computer chip market, the strongest sign yet that regulators worldwide are serious about opening the technology sector to competition.
Intel "went to great lengths to cover up its anti-competitive actions" and "harmed millions of European consumers" to maintain its dominance of the global market for the chips, which is worth about 22 billion euros a year, Ms Kroes said. D Bruce Sewell, Intel's chief lawyer, took "great exception" with the decision and pledged to file an appeal at the Court of First Instance, the second-highest tribunal in Europe. The fine was the largest ever for any breach of competition law in the European Union, previous records were levied mostly on companies involved in cartels.
Microsoft and IBM Michael Reynolds, an antitrust partner with the law firm Allen & Overy in Brussels, said Europe was continuing to burnish its reputation for activism. The Intel decision showed the commission "wanted to send a clear signal that it is taking a leadership role in enforcing competition rules against dominant companies in the technology markets," Mr Reynolds said. Ms Kroes ordered Intel to stop offering rebates that were conditioned on buying less of a rival's product, or not buying them at all, which she said had helped Intel maintain a share of at least 70 percent of chip sales market from October 2002 to December 2007.
She said Intel also had made payments to Media Saturn Holding, the owner of the MediaMarkt chain of superstores for only selling Intel-based computers in Germany, Belgium and other countries. Ms Kroes said her officials had proof of Intel's activities in the form of e-mail messages collected during surprise raids and formal responses to its inquiry from companies concerned. Under the order, Intel must change its practices immediately pending its appeal, although it can ask for an injunction. The company must write a bank guarantee for the fine right away, though that guarantee is held in a bank account until appeals are exhausted, a process that could take years. The commission can levy fines of up to 10 percent of a company's annual global sales. Money collected in antitrust cases is added to the trade bloc's annual budget of around 130 billion euros. The previous record fine for similar abuses in the European Union was 497 million euros imposed on Microsoft in March 2004 for blocking competition in markets for server computers and media software. The previous record for a fine by the commission was 896 million euros on a French company, Saint-Gobain, imposed last year for fixing prices in the auto-glass market. The European Union began stepping up its pursuit of possible violations, and particularly cases in the technology sector, early this decade, when the Bush administration backed away from pursuing tough penalties against Microsoft, deciding to settle a case focused on the company's browser software instead. Last year, the Federal Trade Commission in Washington stepped up its inquiries into Intel, opening a formal investigation.
Cisco Systems, the world's largest maker of networking equipment, about the market for network maintenance services. IBM, which settled a long-running antitrust case with the commission in the 1980s, faces a new complaint. And Google, the industry's newest giant, is also coming under closer scrutiny, in particular for its domination of advertising over the Internet.
Next Page Kevin J OBrien contributed reporting from Berlin; Ashlee Vance contributed reporting from Mountain View, Calif. This article has been revised to reflect the following correction: Correction: May 19, 2009 Because of an editing error, an article on Thursday about a fine against Intel by antitrust regulators in Europe erroneously included one company on a list of technology companies under investigation by those authorities. Google is not the subject of an inquiry by the European Commission.
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