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© tom_schmucker-dreamstime.com Components | June 12, 2014

Intel stuck with EUR 1.06 billion bill

The General Court upholds the fine of EUR 1.06 billion imposed on Intel for having abused its dominant position on the market for x86 central processing units between 2002 and 2007.

Intel’s action against the Commission’s decision is dismissed in its entirety. Back in 2009, the European Commission imposed a fine of EUR 1.06 billion on Intel, for having abused its dominant position on the market for x86 central processing units (CPUs). Moreover, the Commission ordered Intel immediately to bring an end to that infringement in so far as it had not already done so. According to the Commission, Intel abused its dominant position on the worldwide market for x86 CPUs from October 2002 to October 2007, by implementing a strategy aimed at foreclosing from the market its only serious competitor, AMD. Intel brought an action against the Commission’s decision before the General Court, seeking the annulment of that decision or, at least, a substantial reduction of the fine. In today’s judgment (2014-06-12), the General Court dismisses the action and thus upholds the Commission’s decision. The General Court finds, inter alia, that the rebates granted to Dell, HP, NEC and Lenovo are exclusivity rebates. Such rebates are, when applied by an undertaking in a dominant position, incompatible with the objective of undistorted competition within the common market. That amount was determined on the basis of the value of sales of x86 CPUs invoiced by Intel to undertakings established in the EEA market during the last year of the infringement (EUR 3 876 827 021 in 2007). The Commission then determined a proportion of that value on the basis of the degree of gravity of the infringement (5% of a possible 30%), multiplied by the number of years of infringement (five years and three months, resulting in a multiplier of 5.5). Finally, the General Court considers that none of the arguments raised by Intel supports the conclusion that the fine imposed is disproportionate. On the contrary, it must be considered that that fine is appropriate in the light of the facts of the case. The General Court states, inter alia, that the Commission set the proportion of the value of sales, determined on the basis of the gravity of the infringement, at 5%, which is at the lower end of the scale which can go up to 30%8. Moreover, the fine is equivalent to 4.15% of Intel’s annual turnover, which is well below the 10% ceiling provided for.
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