Out-Law News 1 min. read

European Commission threatens Microsoft with fines


The European Commission is unhappy with the way that Microsoft is implementing sanctions imposed on it for breaching antitrust laws. According to reports, this may result in the Commission imposing additional fines of around $5 million per day.

The Commission appears to be particularly concerned about Microsoft's implementation of an order that it disclose details of the interfaces required for third party products to be able to "talk" with Windows, to any business wishing to develop and distribute work group server operating systems.

According to reports, the Commission is worried that Microsoft is charging too much for the interoperability licenses and is not providing sufficient technical detail to allow competitors to assess whether they should buy a licence.

In addition, competitors are required to buy the full licence and cannot take only those bits that they need, while open source developers are completely excluded from the process.

"The Commission remains patient but there are limits to the patience we are prepared to show," Commission spokesman Jonathan Todd told the Associated Press. "The ball is now in Microsoft's court and I am sure they will come back to us shortly on these issues."

In February Todd admitted that the Commission has the power "to decide to impose penalty payments up to five percent of Microsoft's average daily turnover."

Based on last year's turnover, this could amount to around $5 million a day.

Microsoft has several weeks to respond to the Commission, and speaking to Bloomberg news, Microsoft spokesman Tom Brookes confirmed, "We remain committed to working with the Commission".

The European Commission found Microsoft guilty of breaking competition law last March, ruling that the software giant had leveraged its near monopoly in the market for PC operating systems onto the markets for work group server operating systems and for media players.

Because the illegal behaviour was still ongoing, the Commission ordered Microsoft to disclose to competitors, the 'specifications' (but not the source code) for its client-to-server and server-to-server communications protocols.

Microsoft was then required to offer for sale in Europe a version of Windows without Windows Media Player, although it can also market the operating system with Windows Media Player.

It also fined Microsoft €497 million for abusing its market dominance in the EU.

Microsoft paid the fine into an escrow account in July, where it will be held until the appeal against the ruling has been resolved. It then asked the Court of First Instance to suspend the sanctions until the antitrust appeals process had been completed – a process that could take up to five years to complete. This request was denied in December.

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