announced it intended to appeal the EU
's decision to slap it with a $1.45 billion fine; the text of the company's request for annulment is now available in the Official Journal of the European Union.
The Santa Clara-based company's request is best understood as an
attempt to throw mud on the wall and see if anything sticks—Intel goes
after the decision from all angles.
In its petition, Intel claims the following:
- The conditional discounts Intel offered its partners were not proven to have affected competition.
Directorate General for Competition (DG-COMP) did not conduct analyze
whether Intel's actions had a material effect on consumers, and
- The EC failed to consider whether or not Intel's rebate program affected EU citizens or were implemented in EU territory.
scarcely the end of the list; Intel levies a number of separate charges
against the EC as well. Specifically, the company alleges that the EC
failed to demonstrate a causal link between conditional discounts and
the sale of AMD products, and conducted no analysis on the real-world
impact Intel's discounts had on customers. Intel also alleges that its
ability to defend or exculpate itself entirely was impaired by the EC's
decision not to allow Intel access to certain documents Intel thought
it desired. The $1.45 billion fine is contested on the grounds that
because no causal
link could be proven between Intel's
discounts, AMD's market share, and alleged consumer harm, the fee is
"manifestly disproportionate." It's a bit odd that that Intel used the
words "causal link," as such a condition would require that 100 percent
of the alleged impact on AMD was caused by "conditional
discounts and the decisions of Intel’s customers not to purchase from that competitor.
causality is extremely difficult to prove in anything but the simplest
scenarios, courts rely on correlative evidence—hence the phrase
Not pictured: The US judiciary system
of the complaints Intel is leveling, such as access to documents held
by the other party, are complaints over differences in the judicial
systems of the US and the EU. One of those differences is the fact that
in the European Union, the plaintiff does not
have to prove
that customers were in some way harmed by the actions of the defendant.
It's enough to establish that the defendant's actions, even if they
didn't directly affect citizens, blocked or reduced the plaintiff's
access to the market.
One of the EU's benchmark tests to
determine the existence or absence of anti-competitive behavior is an
"as efficient competitor" or AES test. The EU recently updated its own
guidance on exclusionary abuses, the PowerPoint is over here. An AES
test examines market conditions, prices, and changes against a
so-called "efficient competitor." The point of the analysis is to
determine whether or not a company's situation (AMD, in this case) is a
result of its own inefficiency, or due to the actions of a larger, more
powerful competitor. The EU officials who performed that test obviously
felt Intel was twisting the market to favor its own goals.
argument attacks the validity of DG-COMP's AES test from several
angles. First, Intel claims that the EC "fails to prove that Intel’s
rebate arrangements were conditional upon its customers purchasing all
or almost all of their x86 CPU requirements from Intel." While Intel
acknowledges that an AES test was conducted, it also claims that the EC
"commits numerous errors in the analysis and assessment of the evidence
relating to the application of that test." Put more concisely, Intel is
asking for an annulment of the fine because the DG-COMP's office is run
by a bunch of blithering idiots.
Regardless of whether Intel
wins or loses its appeal there's a certain irony in the fact that AMD
won't see a cent of the $1.45 billion fine. The one trial that could
award damages begins this spring. If you're interested in perusing the
text of Intel's claim, it's over here