South Korea fines Intel over fair-trade laws

By Kelly Olsen  |   2008-6-6  |     NEWSPAPER EDITION

SOUTH Korea's anti-trust regulator said yesterday it will order Intel Corp to pay 26 billion won (US$25.4 million) for violating fair-trade rules.

The Korea Fair Trade Commission said in a statement that it was issuing the order because the semiconductor giant offered rebates to South Korean computer companies to undercut competitor Advanced Micro Devices Inc.

Intel immediately criticized the ruling and said it would consider its options, including a possible appeal.

"We're disappointed and we completely disagree with the findings," Bruce Sewell, Intel senior vice president and general counsel, said in Seoul.

The KFTC last year charged Intel with violating South Korean anti-trust laws after completing a two-year investigation.

The commission said Intel gave rebates to Samsung Electronics Co and other South Korean computer makers to encourage them not to use central processing units manufactured by AMD, Intel's main competitor.

Samsung spokesman Lee Soo-jeong said the company had no 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.

Intel dominates the world market for microprocessors.

The company, based in Santa Clara, California, has faced numerous legal battles over how it maintains its market position.

The firm has denied breaking any laws.

Sewell said the firm would wait for the issuance of an official outcome from the commission, which could take between 30 and 60 days, before deciding upon what action to take.

Details of the ruling could change during that period.

He said Intel has the option to request a reconsideration to the commission, though could also seek a court ruling.

The commission ordered Intel to stop using rebates to encourage South Korean companies not to use the CPUs of AMD and thereby maintain its market share.