European Union antitrust regulators raided computer chip maker Intel and computer retailers yesterday searching for evidence that they may have broken cartel or monopoly rules.

Intel spokesman Chuck Molloy confirmed that the company's Munich office in Germany had been raided and the company would co-operate closely with the investigation. Europe's largest consumer electronics retailer, Germany-based Media Markt, said it was also raided.

The EU said the surprise inspections were a first step in its investigation and it had no strict deadline before it would have to decide whether to file charges or drop the case.

Charges can lead to fines of up to 10% of a company's yearly global turnover. Last year, Intel's revenues were $6.98bn (£3.6bn).

The world's biggest chip maker is already facing formal EU charges of monopoly abuse for below-cost customer rebates and pricing that the EU says undercut smaller competitor Advanced Micro Devices.

Intel, based in Santa Clara, California, sells more than three-quarters of all microprocessors that act as the brains of computers using Microsoft's Windows operating system.

AMD claims Intel's dominance is bolstered by bad behaviour that unfairly shuts out rivals, filing a stream of complaints to demand action by regulators in the United States and Europe.

The EU first took formal moves against Intel last July - six years after it started looking at the company - alleging that it gave "substantial rebates" to computer makers for buying most of their x86 central processing units, or CPUs, from Intel.

The EU executive also said Intel made payments to manufacturers to get them to delay or cancel product lines using AMD chips and that it sold its own chips below average cost to strategic server customers - such as governments and universities - when bidding against AMD-based products.

Below-cost or predatory pricing may be good for shoppers in the short term but, in the EU view, it ultimately harms them by killing off rivals that would offer more choice and set a faster pace for innovation. - AP