Statement by VP Almunia on Microsoft’s fine of 561 million euros

Joaquín Almunia – Vice President of the European Commission responsible for Competition Policy

Brussels, 6-3-2013 — /europawire.eu/ — Today, the Commission adopted a decision sanctioning Microsoft for its failure to comply with the legally binding commitments which it made to the Commission. The Decision imposes a fine of 561 million euros on Microsoft for this very serious infringement.

As you may recall, in December 2009 the Commission made legally binding on Microsoft the commitments offered by the company.

As of March 2010, Microsoft was therefore obliged to display until 2014 a “choice screen” enabling users of Windows in the EU to easily choose their preferred web browser.

Although Microsoft did make the choice screen available in March 2010, the choice screen was not rolled out as required following the launch of Windows 7 Service Pack 1 in May 2011.

As a consequence, during more than a year, until July 2012, around 15.3 million users did not see the choice screen as they should have.

Microsoft has acknowledged that it did not comply with its own commitments.

Immediately after I received information about this fact, I ordered the reopening of proceedings, and in October last year a Statement of Objections was adopted to which Microsoft replied in December.

Following an in-depth investigation and taking into account Microsoft´s reply to our objections, today’s decision finds that Microsoft has indeed breached its legally binding commitments.

Such a breach is of course very serious, irrespective of whether it was intentional or not, and it calls for a sanction. The Commission has therefore imposed a fine, as foreseen by the EU’s Antitrust Regulation.

This is the first time that the Commission has found a breach of legally binding commitments enshrined in an art. 9 Decision.

In setting the level of the fine, the Commission took into account the gravity and the duration of the infringement as well as the need to ensure that the sanction is sufficiently deterrent.

At the same time, once the breach was discovered, Microsoft cooperated with the Commission and provided information which helped the Commission to investigate the matter efficiently. This was taken into account as a mitigating circumstance.

Let me make a more general remark: commitment decisions are a very important tool in the EU antitrust enforcement system. Decisions of this type – so-called art 9 Decisions – can be a good way to solve antitrust concerns swiftly since they avoid lengthy proceedings.

In fast-moving markets such as the IT sector, this can be particularly helpful, making easier for us to obtain concrete results for consumers.

In 2009, the Commission’s concerns about the tying of Internet Explorer to Windows were very serious. Windows was the dominant operating system, with a 90% market share, while Internet Explorer still had a 55% market share.

The Commission considered that the tying of these two products created a strong risk that other browser providers could be foreclosed from this market.

At the time, this solution allowed the Commission to put an end to proceedings which potentially could have lasted much longer.

Microsoft’s legally binding commitment to provide the choice screen allowed the Commission to close its investigation.

The browser choice screen which was introduced thanks to our decision of 2009 was extremely successful with users: in just a few months, between March and November 2010, 84 million browsers were downloaded through it.

Of course, the browser market has evolved a lot since then – and fortunately so. Users can now easily choose, download and install the browser they prefer, which was precisely the objective of the Commission. Easy access to different browsers encourages companies to continue to innovate to provide users with the best products.

There are obviously many factors behind this development. One of these factors, indeed, was the introduction of the choice screen itself, as shown by these tens of millions of downloads.

Our decision of 2009 provided the right solution to the competition concerns identified at the time.

However, it goes without saying that this type of settled outcome of an antitrust investigation can only work if the commitments are then scrupulously complied with.

Our decision of today reflects this requirement to comply with the commitments agreed with the Commission in art. 9 Decisions.

The lack of compliance is, as a matter of principle, a serious breach of EU law itself.

If companies agree to offer commitments which then become legally binding, they must do what they have committed to do or face the consequences – namely, the imposition of sanctions.

I hope this decision will make companies think twice before they even think of intentionally breaching their obligations or even of neglecting their duty to ensure strict compliance.

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