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South Korea Fines Intel $25 Mln

South Korea Fines Intel $25 Mln

South Korea’s Fair Trade Commission has fined U.S. chipmaker Intel some 26 billion won (about $25 million USD) for offering rebates and discounts to its customers in an effort to prevent those customers from buying competing products from AMD. The decision comes as Intel is being targeted by an EU antirust investigation and faces a U.S.-based antitrust suit from AMD. In 2005, Japanese regulators forced Intel to remove restrictions preventing customers from using rival chips.

The Fair Trade Commission’s judgement focussed on rebates paid to Samsung Electronics and Trigem Computer, Inc.; Intel offered the companies over $37 million in rebates over a two-and-a-half year period on the condition that they wouldn’t purchase processors from AMD. According to the Fair Trade Commission, the lock-ins helped grow Intel’s share of the Korean market to and average of 91.3 percent in the five years ending in 2005, compared the global average of 79.6 percent for the same period.

Intel has disputed that the rebate arrangements hinged on any kind of exclusivity with customers, and is widely expected to appeal the decision.

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