Anti-trust regulators around the world, are testing the limits of the law in their pursuit of Intel said Intel senior vice president Bruce Sewell.
Speaking after the European Commission found Intel guilty of abusing its dominant position in the microprocessor chip market in Europe by the way it paid rebates to vendors, he said that he was baffled by what Intel had done wrong.
Today's ruling isn't against rebates, just the rebates that abuse a market position," competition commissioner Neelie Kroes said during a press conference convened to announce the anti-trust decision.
It is, she said, a very clear cut case of abuse of a dominant position. "I can't imagine it's unclear what has to stop."
But Intel's Sewell said it is very unclear."I am mystified as to what it is we are being asked to change," he said, adding that the ruling fails to distinguish between permissible and illegal rebates.
Intel said it would appeal the ruling, a process that could take several years.
And in what appeared to be a rebuke of anti-trust authorities the world over, Sewell said: "There's been an evolution in anti-trust law and how rebates are to be conducted by dominant companies. We see a line of thought coming mainly from the European Commission - but also in Korea and Japan - that rebates can be anti-competitive."
"Anti-trust agencies are testing the boundaries of the law," he said.
Last year Korea's Fair Trade Commission (KFTC) fined Intel $25 million and ordered it to stop paying PC manufacturers rebates in return for excluding AMD chips. Intel is appealing the ruling. In 2005, the Japan Fair Trade Commission (JFTC) ruled that Intel had violated the country's anti-monopoly laws by illegally forcing full or partial exclusivity with five Japanese PC makers in return for rebates. The US Federal Trade Commission has also started an investigation into Intel.
Sewell said the company settled with the Japanese authorities and escaped being fined after agreeing not to apply certain types of rebates.
"In Japan, we were told to stop certain types of rebates which we weren't even using, never had done. Three years on nothing in that market has changed and no one is contesting whether we are in compliance," he said.
As for the US, Sewell said he read the comments by Christine Varney, the new chief of the anti-trust division of the Justice Department "with great interest" and vowed to work closely "with all agencies."
Earlier this week, Varney effectively called an end to eight years of inertia in the department she has taken over. The Obama administration will vigorously enforce anti-monopoly laws and work more like the Commission in tackling monopoly abuse, she said. Not one anti-trust case was pursued under the two Bush administrations.
Kroes welcomed Varney's comments. "They give me a huge positive feeling. The more competition authorities join with us the better," she said, adding she was confident there would be a close working relationship in anti-trust across the Atlantic.