Intel Corp (INTC)

[Windsock]

American companies that want to earn euro's are subject to European law, it's that simple

All very true. But companies need a clear definition of the law to guide their conduct.

Global companies such as Intel – and Microsoft for that matter -- seek legal counsel from the best law firms in Europe. The problem is that the EEC law on competition is very uncertain.

The whole concept of European Economic Community law as opposed to European national law is a new and still evolving field. In the area of competition, the Trade Commission seems to be making up the law as it goes along. The law is not passed as well defined legislation and the documented regulations are vague at best. No company can comply with trade regulation law that is unwritten and unknown.

Returning to Microsoft, the fine is not a significant economic issue for Microsoft although the press is focusing on the $670 million as if it were huge. The need to produce a version of Windows without Media Player is raging stupid but not that significant economically.

The difficult part of the EEC Commission ruling is that Microsoft must open its trade secrets and source code to competitors for reasonable compensation. This goes far beyond API specifications. Assuming for the sake of argument that this is fair and IMO it is not, the Commission has determined that a royalty of 1% of product revenue is too high. That is f***ing incredible to me.