Sunday, June 22, 2008

Intel fined by South Korea

In the latest development in the ongoing saga of investigations and lawsuits concerning Intel's trade rebate practices, South Korea has fined Intel about $25mil for rebates:

Intel offered about $37 million in rebates over 2 1/2 years to Samsung and Trigem on the condition that they wouldn't buy from Advanced Micro, according to commission's statement. [...]

The commission's description of the funds from Intel is a ``stretch'' because they were used to jointly market products, Trigem said in an e-mailed statement. Samsung Electronics spokesman James Chung declined to comment.

Intel denies the charges and is expected to appeal the ruling.

Bigger than the fine from South Korea, which is probably pretty much a rounding error in Intel's books, is the possibility that this might have an impact on the EU's investigation of Intel and/or on AMD's lawsuit against them in the US, both of which are based on pretty much the same set of facts as the Korean case.
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 has also been sued by Advanced Micro in the U.S.

``An investigation in Korea invariably has some effect on the outcome of investigations in the United States, in the EU and elsewhere,'' said Brendon Carr, a business attorney at the law firm of Hwang Mok Park in Seoul. ``Every domino that falls is a painful one for a global enterprise.''

Previous Intel items, several of which deal with these cases, are here.

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