Thu, Jun 5 04:38 PM
SEOUL, South Korea (AP) _ Intel Corp. is facing a multimillion dollar fine in South Korea for something it says it does not do: Pay customers rebates to protect market share and hinder competition.
The Korea Fair Trade Commission announced Thursday it will order Intel Corp. to pay 26 billion won (US$25.
4 million) for violating fair trade rules. The final amount could change slightly, the commission said.
The commission last year charged Intel with violating South Korean antitrust laws after completing a two-year probe, but announced details and penalties now. The regulator said in a statement that Intel paid rebates to South Korean computer companies to undercut main rival Advanced Micro Devices Inc.
The commission also ordered the semiconductor giant to stop using such rebates for the purpose of encouraging South Korean companies not to use the central processing units, or CPUs, of AMD so as to protect market share. "To ask us to cease and desist behavior which we are not doing and never have done is odd," Intel spokesman Nick Jacobs said.
"We don't use rebates in an anticompetitive fashion." Intel is the world's No.
1 maker of microprocessors, the brains of personal computers. The company recorded net profit of US$7 billion in 2007 on sales of US$38.
3 billion. AMD is No.
2, but stands far behind its rival. Sunnyvale, California-based AMD's Seoul office could not be reached for comment.
Intel has been scrutinized by regulators in several countries and the European Union over allegations it abused its market dominance to pressure computer makers and undermine rivals. The company, based in Santa Clara, California, has repeatedly denied breaking any laws.
The commission said that Intel provided rebates to Samsung Electronics Co. and Trigem Computer Inc.
to persuade them not to use CPUs from AMD. The commission said that Samsung received between US$30 million to US$32 million from Intel in the form of rebates from the second quarter of 2002 to the same quarter of 2005.
Trigem, meanwhile, received US$6.4 million between the third quarter of 2003 and the second quarter of 2005, the commission said.
Samsung spokeswoman Lee Soo-jeong said the company had no comment. "It is hard to say that what we received was an illegal rebate," said Trigem spokesman Bang Yeong-il, adding that it was used legally for joint marketing.
Bruce Sewell, Intel senior vice president and general counsel, said that the company would wait for the issuance of an official outcome from the commission, which could take between 30 and 60 days, before deciding a course of action. Sewell said Intel has the option to request a reconsideration to the commission, though could also seek a court ruling.
"We're disappointed and we completely disagree with the findings," he said. Intel's antitrust woes in South Korea follow a fine the KFTC handed to Microsoft Corp.
The commission in a final ruling in February 2006 fined Microsoft 32.5 billion won and ordered it to provide two separate versions of Windows, saying the company abused its dominant market position by tying certain software to the operating system.
The fine was equal to about US$32 million at current exchange rates. Microsoft complied with the fine and the order, but still fought the ruling in court.
The company said in October last year, however, that it had dropped its legal battle to overturn the decision. __ Associated Press writers Hyung-jin Kim, Jae-soon Chang and Jae-hyun Jeong contributed to this report.
No comments:
Post a Comment