Intel, the computer chip manufacturer, has been fined a record 1.06bn euros ($1.45bn; £948m) by the European Commission for anti-competitive practices involving its competitor Advanced Micro Devices (AMD).

The investigation followed a complaint by Intel’s rival.

The European Commission said Intel gave price discounts to computer manufacturers Acer, Dell, HP, Lenovo and NEC for buying all or almost all their chips from it.

The company has already announced that it will appeal against the decision saying the fine: “suggests that the commission supports AMD’s position that Intel should be prevented from competing fairly and offering price discounts which have resulted in lower prices for consumers”.

The fine dwarfs the 497m euro fine levied on Microsoft in 2004 for abusing its dominant market position but it is still less than the European Commission could have handed down to Intel. Under EC rules the maximum fine can be 10 per cent of global turnover – which for Intel could have meant up to $3.7bn (£2.4bn).

The European Commission stated: “Intel has harmed millions of European consumers by deliberately acting to keep competitors out of the market for computer chips for many years,” said Competition Commissioner Neelie Kroes.

“Such a serious and sustained violation of the EU’s antitrust rules cannot be tolerated.”

Last year, Intel made 80.5 per cent of the microprocessors in PCs, while AMD made 12 per cent of them.

The Commission has also ordered Intel “to cease the illegal practices immediately to the extent that they are still ongoing”.