Antitrust Law, Technology Transactions, and Antitrust Law | Mergers + Acquisitions
The Commission's legal theory is that Microsoft has infringed Article 82 of the EC Treaty by "abusing its dominant position" on the desktop operating system market in order to leverage that position into the low-end server market, where Microsoft's market position has grown very rapidly. The abusive conduct consists essentially of (i) denying interface and other technical information to other server software suppliers, thus preventing them from producing server software which can run effectively with new generations of Microsoft products, (ii) bundling Media Player into the operating system, which helps Microsoft to leverage its desktop monopoly into the low-end server operating system market, and (iii) Microsoft licensing practices which encourage customers to license Microsoft server as well as desktop products.
There are some significant differences between the Commission's approach, and that of the U.S. Department of Justice ("DOJ") following the D.C. Circuit Court of Appeals judgment of June 28, and the DOJ's recent announcement that it is dropping the Section 1 tying claim and will not seek structural remedies.
What happens next?
Microsoft now has two months to make a written submission rebutting the accusations of the SO; other interested parties will then have a short interval to comment on the SO and Microsoft's rebuttal. Late this year or early next, there will be a hearing at which all the parties can express their views to the Commission and the Advisory Committee of the Member States. Then it will be for the Commission to take a decision, which could be some time during the first half of 2002. More often than not, Commission decisions follow structure and content of the SO. In this case, an important role may be played, not only by the debate within the four corners of the EU proceeding, but also by what happens in the market place, as well, possibly, as what happens in the US proceeding. In any event, it seems likely that the decision will be a stage in a continuing struggle, and not its end.
Summary of the Two Cases
U.S. case (after DC Circuit Court of Appeals decision and DOJ announcement):
A version of this article also appears in The Lawyer.
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