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Microsoft To Comply Fully With EU Antitrust Ruling

by Ulrika Lomas, for LawAndTax-News.com, Brussels

23 October 2007


Following the loss last month of its appeal at the European Court of First Instance (CFI), it was announced on Monday that Microsoft will come into full compliance with the terms of the European Commission's antitrust ruling against it.

In a statement published on Monday, the EC revealed that:

"The European Commission has ensured that Microsoft will now take the necessary steps to comply with its obligations under the Commission’s 2004 Decision regarding work group server operating systems, including the making available to ‘open source’ software developers of the interoperability information that Microsoft is obliged to disclose."

"Microsoft has finally agreed to three substantial changes to bring them into compliance with the decision. First, ‘open source’ software developers will be able to access and use the interoperability information. Second, the royalties payable for this information will be reduced to a nominal one-off payment of EUR10 000. Third, the royalties for a worldwide licence including patents will be reduced from 5.95% to 0.4% - less than 7% of the royalty originally claimed."

It continued:

"In these agreements between third party developers and Microsoft, Microsoft will guarantee the completeness and accuracy of the information provided. The agreements will be enforceable before the High Court in London, and will provide for effective remedies, including damages, for third party developers in the event that Microsoft breaches those agreements."

"Effective private enforcement will therefore complement the Commission's public enforcement powers. These changes mean that open source competitors to Microsoft will be able to provide businesses with competitive, innovative alternatives to Microsoft work group server products, knowing that they are fully interoperable with Microsoft's Windows desktop operating system."

"The Commission will now adopt a decision as soon as possible on the pending non-compliance case regarding past unreasonable pricing for the interoperability information, on which the Commission sent a Statement of Objections on 1 March 2007...Microsoft also has ongoing obligations to continue to comply with the Commission's 2004 Decision: should Microsoft fail to comply with those obligations in the future the Commission can issue a new decision to impose daily penalties."

Competition Commissioner Neelie Kroes announced that:

“I welcome that Microsoft has finally undertaken concrete steps to ensure full compliance with the 2004 Decision. It is regrettable that Microsoft has only complied after a considerable delay, two court decisions, and the imposition of daily penalty payments. However, the measures that the Commission has insisted upon will benefit computer users by bringing competition and innovation back to the server market. The Commission will remain vigilant to ensure that Microsoft continues to respect its compliance obligations and does not engage in other anti-competitive behaviour. I have always said that open source software developers must be able to take advantage of this remedy: now they can.”

Microsoft, meanwhile, stated this week that:

“At the time the Court of First Instance issued its judgment in September, Microsoft committed to taking any further steps necessary to achieve full compliance with the Commission’s decision. We have undertaken a constructive discussion with the Commission and have now agreed on those additional steps. We will not appeal the CFI’s decision to the European Court of Justice and will continue to work closely with the Commission and the industry to ensure a flourishing and competitive environment for information technology in Europe and around the world.”

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