EU steps up Intel antitrust probe

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European Union antitrust officials on Tuesday raided the offices of Intel and several computer manufacturers and distributors, in an escalation of their probe against the world's largest chipmaker.

The raids underline the European Commission's determination to conclude a case launched five years ago, and is an important step in the worldwide campaign against Intel waged by Advanced Micro Devices, its smaller rival. Last month, AMD filed an antitrust complaint against Intel in a US court accusing the group of illegally maintaining a monopoly.

A complaint by AMD in Japan led to a formal ruling against Intel this year by the Fair Trade Commission.

The Commission probe, however, raises perhaps the most serious threat to the US chip giant, because Brussels has the power to impose antitrust fines of up to 10 per cent of global annual turnover. Though the EU regulator normally settles for a lower fine, penalties can run into hundreds of millions of euros.

All three actions are based on similar allegations that Intel offered rebates to personal computer manufacturers that were aimed at excluding AMD from competing for business.

A spokesman for Neelie Kroes, the EU competition commissioner, said: “I can confirm that Commission officials accompanied by officials from national competition authorities have conducted on-site investigations at several premises of Intel Corporation in Europe as well as a number of IT firms manufacturing or selling computers.”

He added: “The investigations are within the framework of an on-going competition case.”

The Commission's investigation into alleged abuses by Intel began in 2000, after AMD filed a complaint to the Brussels regulator. The probe was almost abandoned in 2002, but gathered steam again one year ago, when the Commission requested fresh information from Intel and other market players.

A spokeswoman for Intel said: “We can confirm that officials of the European Commission conducted a search of some Intel offices in Europe. It is Intel's normal practice to co-operate fully with regulatory agencies and we are doing so in this case. We believe that Intel's business practices are both fair and lawful.”

She declined to reveal which offices had been raided. Intel's European headquarters are split between Swindon in the UK and Munich, Germany, and it has offices across dozens of countries in Europe.

Computer manufacturers, including Dell, IBM, Toshiba and Sony, all declined to comment on whether raids had taken place at any of their offices. Hewlett Packard said its offices had not been visited by officials.

Competition officials are certain to spend at least several months analysing the information gathered in Tuesday's raids.

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