EC to clear Intel in antitrust inquiry

The European Commission will drop its antitrust probe of Intel, concluding that the complaints against the chipmaker are...

The European Commission will drop its antitrust probe of Intel, concluding that the complaints against the chipmaker are groundless.

The move would mirror the outcome of a similar investigation of Intel in the US, which was dropped by the Federal Trade Commission in September 2000.

"The intention is to close the (Commission's) inquiry," said a source close to the inquiry. "After careful analysis of the complaints the Commission has decided that the accusations are unfounded."

When the investigation into Intel came to light last April the Commission said that dominant companies must be careful how they use loyalty schemes with their customers."

The identity of the companies that sparked the probe by the EU competition regulator has never been officially revealed, but is believed by industry insiders to be AMD and Via Technologies.

The two companies admitted last year that they provided information to the Commission during its probe of Intel, but both companies have declined to comment on whether they made the complaints that sparked the probe.

The complaints charged Intel, the world's largest maker of PC microchips, of abusing its dominant position by tying in customers with loyalty schemes and co-funding PC makers' marketing campaigns. Intel said this joint marketing programme works with 1,500 companies worldwide - 800 of those in Europe.

The complaints alleged that the company competed unfairly by selectively licensing the design of system buses and other connection technology that links chips with other computer components, thereby creating compatibility problems for rival chip makers.

An Intel spokesman said that the company not aware that the EC planned to drop its complaint.

"We know that Via Technologies dropped their complaint," said Intel spokesman Chuck Mulloy, "but we are unaware that the Commission had made any final determination on that or the other complaint."

The Commission receives around 100 antitrust complaints a year and more than half of these are thrown out by the regulator without any formal ruling or public statement being made.

If the complainants disagree with the Commission's conclusions they can force the EU competition regulator to take a formal decision in the Intel case, said a lawyer familiar with the investigation. "Once there is a formal decision to drop the case the rivals can then attack that decision in court," said the lawyer.

Rivalry between AMD, Via and Intel has become intense. In December 2001 Intel dropped a lawsuit against Via over that company's alleged violation of Intel's patent for the Pentium III processor. A month earlier a court in San Jose denied a motion by AMD to unseal court documents concerning Intel and make them available to the European Commission for its investigation.

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