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Tomorrow is Intel's Judgement Day

by on05 September 2017

Europe's top court will rule 

Tomorrow is a big day for huge US corporate tech as Europe's top court will rule whether US chipmaker Intel offered illegal rebates to squeeze out rivals in a judgement which will have a knock on effect on other similar cases.

The ruling by the Luxembourg-based Court of Justice of the European Union (ECJ) could  provide more clarity on whether rebates are anti-competitive by nature or whether enforcers need to prove the anti-competitive effect. 

The European Commission in a 2009 decision said that Intel tried to thwart rival AMD by giving rebates to PC makers Dell, Hewlett Packard, NEC and Lenovo for buying most of their computer chips from the company. It handed down a $1.3 billion fine.

A lower court upheld the EU competition authority’s decision in 2014, but last year an ECJ court adviser backed Intel’s arguments.

An adverse ruling for the Commission on Wednesday could result in a radical review of ongoing cases including cases against Google and Qualcomm.

Losing against Chipzilla will mean that long-established theories and processes would need to be reassessed and this would be a blow to the Commission and a confidence boost for Google, since, on the face of it, the theory of harm is much more established in the Intel case.

Google has come under fire from the EU over its Android smartphone operating system and online search advertising.

US chipmaker Qualcomm, meanwhile, faces EU charges of using anti-competitive methods to squeeze out British phone software maker Icera and of making illegal payments to a major customer for exclusively using its chipsets since 2011.

However it would be unusual for the ECJ to go against the Commission.  If it wins, it will be business as usual and US companies could find themselves increasingly going against a hostile culture alien to them. In the US, corporations are used to rolling over the comparitively tame toothless watchdogs which are staffed, hired by, bought and paid for political appointees.   


Last modified on 05 September 2017
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