Korea will fine Intel $25 million

SOUTH KOREA'S antitrust authority announced Thursday that it will fine the huge microprocessor manufacturer Intel Corporation 26 billion won ($25.4 million) for violations of that country's Fair Trade law.

In a statement, the Korea Fair Trade Commission said it would order the penalty because the huge semiconductor company offered rebates to South Korean computer firms, including Samsung Electronics, and unfairly interfered with the business of competitor Advanced Micro Devices (AMD).

The world's dominant computer chipmaker headquartered in Santa Clara, California, criticised Korea's order and said it would consider its options, including a possible appeal.

From Seoul, South Korea, D. Bruce Sewell, Intel senior vice president and general counsel said, "We're disappointed, and we completely disagree with the findings." Intel will wait for formal issuance of the Commission's order, which might take 30 to 60 days, before deciding its next course of action, Mr. Sewell indicated.

The company might ask the Korea Fair Trade Commission to reconsider, or it could request a judicial review in court.

Intel is facing similar allegations of antitrust violations in regulatory proceedings before trading authorities in Japan and the European Union, as well as in an antitrust lawsuit filed by AMD in a US Federal Court in Northern California.

Although the amount of the South Korean fine is relatively small compared to Intel's annual revenues, the amounts at stake for Intel in those other antitrust actions might reach billions of dollars. So, whether or not this Korean ruling ultimately stands could have serious future repercussions for Intel in those other jurisdictions.

The New York Times coverage is here. µ