Intel fined for antitrust rules breach

Intel Corp, the world's biggest computer-chip maker, was fined about 26 billion won ($25 million) by South Korea's antitrust regulator for deterring competition by offering illicit discounts to customers.

Samsung Electronics Co and Trigem Computer Inc received rebates from Intel, provided they didn't buy processor chips from Advanced Micro Devices Inc, the Korea Fair Trade Commission said yesterday. Intel will probably appeal the ruling, General Counsel Bruce Sewell said.

The verdict is a setback for Santa Clara, California-based Intel as it awaits a ruling from the European Union, where regulators can fine companies up to 10 percent of annual sales for antitrust breaches. In 2005, Japan forced Intel to remove clauses restricting Japanese computer makers from using rival chips. Intel also faces a lawsuit from Advanced Micro in the United States.

"An investigation in (South) Korea invariably has some effect on the outcome of investigations in the United States, in the EU and elsewhere," said Brendon Carr, an attorney at the law firm of Hwang Mok Park in Seoul.

Intel offered about $37 million in rebates over two-and-a-half years to Samsung and Trigem on the condition that they wouldn't buy from Advanced Micro, according to the commission's statement.

The practice helped Intel's market share average at 91.3 percent in the five years ending in 2005 in South Korea, higher than 79.6 percent globally, according to the statement.

The commission's description of the funds Intel gave is a "stretch" because they were used to jointly market products, Trigem said. Samsung Electronics spokesman James Chung declined to comment.

Agencies

(China Daily 06/06/2008 page16)