European Court of First Instance to re-examine fine of €1.06 billion imposed upon Intel

The appeal of the American manufacturer of computer chips, Intel, against the fine of €1.06 billion, imposed in 2009 by the European Commission for abuse of a dominant position, must now be re-examined by the Court of First Instance of the European Union (CFIEU).

This was held on Wednesday by the Court of Justice of the European Union (ECJ).

The ECJ writes in communiqué, “The case has been returned to the Court of First Instance of the European Union to allow it to examine the arguments put forward by Intel.” On June 12th, 2014, the CFIEU had confirmed the fine of €1.06 imposed by Commission, stating that it was entirely correct. This included the actual total for the fine, which Intel considered disproportionate.

However, the American corporation had lodged an appeal before the court. It said that the judge had committed an error by failing to examine the case “in the light of all relevant circumstances.” In referring the case back to the CFIEU for re-examination, the Court has thus stated that Intel is correct. This will not prevent the CFIEU from potentially again validating the Commission’s fine.

Intel, which held at least 70% of the market share of x86 processors within the EU, was accused of having abused its dominant position between 2002 and 2007, by implementing a strategy intended to exclude its only serious competitor, AMD, from the market.

The abuse, according to the Commission, consisted in particular in discounts given to computer manufacturers such as Dell, Lenovo, HP and NEC. This was so that they would buy virtually all of their processors from Intel. Intel was also accused of having made payments to customers, so that they would either delay or cancel the release of products equipped with AMD processors. It had also made direct payments to the European distributor Media-Saturn, so that the latter would exclusively sell computers equipped with Intel processors.

The record amount fine of €1.06 billion imposed upon Intel has since been exceeded by the €2.42 billion penalty imposed, at the end of June, by the Commission upon Google. This was for having taken advantage, from 2008, of its immensely dominant position as an Internet search engine. Google had achieved this by favouring its price comparison service known as “Google Shopping” in the search engine process.”

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