The European Commission, the regulatory body for the European Union, is notoriously tough on tech companies. From combatting potential monopolies to stopping unfair practices, the Commission has clamped down in recent years. Intel is just one company to feel the wrath of the EU, but the chipmaker is fighting back.
Intel’s tussle with the Commission started seven years ago. The company was found to have been stifling chip rival AMD. Intel was doing this by offering rebates to PC giants like Dell, HP, and Lenovo if they purchased the majority of their chips from Intel.
In response, the European court handed the company a $1.19 billion fine for bad practises. The original ruling was explained by the Commission in 2010:
“The effects of these practices were complementary, in that they significantly diminished competitors’ ability to compete on the merits of their x86 CPUs,” said the general court in Luxembourg. “Intel’s anti-competitive conduct thereby resulted in a reduction of consumer choice and in lower incentives to innovate.”
Intel appealed the ruling, saying the decision was harsh. However, the court disagreed and said the fine was only 4.15% of the company’s total revenue for 2008. In other words, Intel could ride the fine and in 2014 the appeal was thrown out.
The Santa Clara-based company did not stop there. Instead, Intel took the case away from the General Court and to the European Court of Justice. Arguing the original judge overlooked important details and did not seek enough evidence, the company has won a minor victory.
The ECJ seems to agree and is sending the case back to the General Court:
“The Court refers the case back to the General Court so that it may examine, in the light of the arguments put forward by Intel, whether the [allegedly anti-competitive] rebates at issue are capable of restricting competition.”
Over the last months, we have seen several tech giants targeted by the EU. Facebook is locked in an ongoing legal dispute, while Google was recently fined over $2 billion (a record amount) for the way it conducts its search practises.
Microsoft has also been a constant target for regulators. The company recently saw an antitrust complaint filed by Kaspersky Lab removed. To appease regulators and third party anti-virus vendors, the company was forced to make several major concessions.