Intel wins major battle as court overturns $1.2 billion fine for anticompetitive practices

Every big tech company eventually has to contend with regulatory authorities for one reason or the other. Back in 2009, Intel found itself in the crosshairs of the European Commission (EC) for allegedly strangling the competition, namely AMD. It was handed a €1.06 billion (~$1.2 billion) fine, which has now been annulled by Europe's General Court, which is the second-highest court in the region.

A European Commission flag with an Intel logo and a gavel next to it

In 2009, the EC handed Intel a €1.06 billion fine for having anti-competitive practices in place to stifle the competition. This includes offering conditional rebates to hardware OEMs such as Dell, Lenovo, HP, and NEC for purchasing all of Intel's CPUs. The company was also reprimanded for offering monetary compensation to a European retailer in order to get it to exclusively sell PCs containing Intel CPUs.

The EC's decision was reviewed again by the General Court in 2014 and upheld. However, it has now been overturned by the same court after the EU Court of Justice - Europe's highest court - demanded that the matter be further investigated after an appeal from Intel in 2017. The court filing states:

[...] the Court of Justice noted that the General Court, like the Commission, had relied on the assumption that the fidelity rebates granted by an undertaking in a dominant position were by their very nature capable of restricting competition, with the result that it was not necessary to analyse all the circumstances of the case or to carry out an as-efficient-competitor (‘AEC’) test.

[...] Since the General Court had failed to conduct such an examination, the Court of Justice set aside the initial judgment and referred the case back to the General Court in order for it to examine, in the light of the arguments put forward by Intel, the capability of the rebates at issue to restrict competition.

Due to incomplete analysis done by the EC and failure to follow due process, the General Court has annulled the fine and its decision that Intel engaged in anti-competitive practices. There are some other details regarding the matter that you can review in the court filing too, if you're familiar with legal jargon. The EC says that it will review the ruling and identify the next steps; it still has the option to appeal the decision to the Court of Justice.

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