Intel’s fight against a record 1.06 billion euro ($1.16 billion) EU antitrust fine received a boost on Thursday when a top Europe court adviser questioned whether the U.S. chipmaker’s actions had really harmed competition.
The opinion from Advocate General Nils Wahl at the Court of Justice of the European Union (ECJ) amounted to a rare setback for the European Commission, underlining the tough battle ahead as it takes on Apple
, and Amazon
in various competition cases.
“Intel’s appeal against the imposition of a 1.06 billion euro fine for abuse of its dominant position should be upheld. The case should be referred back to the General Court for a fresh review,” Wahl said in a non-binding recommendation.
He said the General Court failed to establish that the rebates and payments offered by Intel
were anti-competitive and that certain deals between the firm and Lenovo harmed European consumers. These were key elements of the Commission’s 2009 decision.
The General Court rejected Intel’s challenge two years ago, saying that the European Commission had not acted too harshly in handing down the record sanction amounting to 4.15% of Intel’s 2008 turnover against a possible maximum of 10%.
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The ECJ, which usually follows the adviser’s opinion in the majority of cases, is expected to rule in the coming months. The Commission declined to comment.
Wahl’s opinion is a good sign for companies looking for guidance on what kind of rebates should be considered harmful, said Ian Giles, a partner at London-based Norton Rose Fulbright.
“The extent to which the advocate general disagrees with the Commission is significant. The advocate general’s opinion says – on the Intel facts – the Commission got it wrong,” he said.
“Assuming the court follows this opinion, this is a good outcome from the perspective of competition policy, and may lead to the Commission revising its approach in ongoing cases.”
U.S. chipmaker Qualcomm is fighting EU charges of using anti-competitive methods, including giving rebates, to squeeze a rival. It will lay out its arguments at a hearing on Nov. 10.
Intel’s fine remains the largest for a single company for an EU antitrust infringement.
The EU antitrust enforcer penalized Intel over what it called tactics aimed at stifling rival Advanced Micro Devices
, including giving rebates to PC makers Dell
, Hewlett-Packard, NEC
, and Lenovo
for buying most of their computer chips from Intel.