E.U. probes Germany, Italy for favoring Intel chips

The European Commission has put Germany and Italy under investigation to determine if the countries have been illegally favoring computers with semiconductors from Intel Corp. to the detriment of rivals like Advanced Micro Devices Inc. (AMD), a Commission spokesman said on Wednesday.

The Commission — the European Union’s (E.U.’s) executive body — is concerned about practices that come under its public procurement procedure laws, which forbid contracting authorities from referring to a specific product or process, Commission spokesman Jonathan Todd said.

“We sent a letter of formal notice to both Germany and Italy on March 30, which is a formal request for information,” Todd said. They have until May 30 to reply, he added.

The Commission is also considering similar investigations into Austria, Belgium, Finland, France, the Netherlands and European Economic Area (EEA) member Norway, Todd said. Additionally, the Commission had looked at Sweden, but last month the Swedish government authorities issued a clarification of its public procurement policy that satisfied the Commission, Todd said.

The E.U. is concerned that governments may be paying too much for computers because thousands of tenders across the E.U. specify Intel chips by name, or more indirectly, such as referring to specific document rate or megahertz that correspond only to Intel products, Todd said.

“This is about making sure that taxpayers get value for money,” Todd said. He pointed to a study issued by the Commission earlier this year indicating taxpayers could save about 30 per cent on procurements obtained through open and competitive bidding.

An AMD spokeswoman said the company is fully aware of the investigations while an Intel spokesman said the company was unable to comment.

The E.U. investigations announced Wednesday are not connected to the legal fight between AMD and Intel heard by the U.S. Supreme Court on Tuesday. The case centers around legal documents regarding Intel’s disputes with Intergraph Corp. that AMD wants sent to the E.U. in support of a complaint it filed with the Commission, Todd said.

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