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Koreans conduct 'dawn raid' of Intel offices

Over tea and cookies

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AMD vs Intel South Korean Fair Trade Commission (KFTC) officials today mounted raids on Intel's local offices, as part of the authority's investigation into allegations that the giant abused its leadership position in the chip market, the Korea Economic Times newspaper reported today.

Intel spokesman Chuck Mulloy confirmed that the Korean officials did pay an "unscheduled" visit to the company's offices in Seoul. The move was part of an ongoing investigation into Intel's business practices that started in June of 2005.

"Intel is a very successful company, and it is not unusual for us to come under scrutiny," Mulloy told Reg Hardware. "We believe our business practices are fair and lawful."

The KFTC launched its probe two months after asking Intel to submit documents pertaining to the manufacturer's relationships with South Korean PC companies. In particular, the KFTC said at the time, it wanted information concerning "marketing and rebate programmes" run by the chip giant locally.

AMD - which is currently engaged in legal action against its arch-rival and can't seem to resist any opportunity to claim it's all for free and open competition, the better to imply its arch-rival isn't - was quick to claim the raids mark an intensification of the investigation. There's no smoke without fire, the company said - the FTC wouldn't raid the company if it didn't believe it would find evidence of possible antitrust abuses.

To this point, AMD used the phrases "dawn raid" and "raid" close to ten times in its press release describing the KFTC's actions. Our understanding of the way Korean regulators operate has such a "raid" taking place over tea and snacks.

AMD's legal action against Intel was launched in Japan in June 2005, three months after a probe conducted by Japan's own Fair Trade Commission (JFTC) ruled Intel guilty of deliberately trying to limit AMD's share of the Japanese CPU market by imposing purchasing restrictions on five of the country's biggest PC makers. In return for marketing assistance, the JFTC said, Intel forced at least one vendor to buy all its processors from the chip giant.

AMD alleged the JFTC's raids on Intel's Japanese offices furnished investigators with the evidence they needed to reach their verdict. It hopes the South Korean raids will achieve the same thing.

That said, European Commission officials mounted similar raids on Intel sites in Germany and the UK back in July 2005, but they have yet to announce any formal conclusion to their own probe, one way or the other.

AMD's success throughout 2005 in both the PC and server markets raises some questions about how difficult competing against Intel really is. ®

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