MS readies response to EC antitrust charges

By Paul Meller, IDG News Service |  Government

Microsoft Corp. is on the point of submitting its written response to European Commission (EC) antitrust complaints, a company spokeswoman said, adding that the decision whether or not to request an oral hearing hasn't yet been taken.

Microsoft is responding to the EC's third formal statement of objections, which was sent to the company 10 weeks ago. In it the Commission accused Microsoft of abusing the dominant position of its Windows operating system software in order to extend its monopoly into related markets for server software and audio and video-playing software.

Company spokeswoman Tiffany Steckler declined to comment on the contents of the written reply.

Even though the Commission has set aside Nov. 12-14 for a hearing, the decision whether to go ahead with it rests with Microsoft.

The firm waived its rights to a hearing after receiving the Commission's second statement of objections in 2001. Antitrust lawyers believe a face-to-face encounter with regulators and rivals can do as much harm as good to a defendant's case.

"The company probably assumed back then that sharing the stage with its rivals wasn't a good idea," said one lawyer who asked not to be named, adding: "If they change their minds now and opt for a hearing that could mean they feel more confident about their case."

The Commission's August statement reiterated earlier concerns about the way Microsoft does business. The first two complaints were combined in 2001. The third statement of objections, while not strictly necessary, was issued in order to avert Microsoft from disputing the Commission's procedures, the lawyer said.

A final ruling by the Commission is expected during the first months of next year. In addition to demanding changes to Microsoft's business model, the European Union competition regulator is also likely to impose a fine, if it rules against the company.

Legal experts believe a negative ruling would be appealed at the European Court of First Instance, which would delay the imposition of the sanctions for up to two years.

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