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The U.S. appeals court ruling Thursday in the U.S. Justice Department’s antitrust lawsuit against Microsoft Corp. is certain to reverberate on the other side of the Atlantic. The European Commission, the EU’s executive agency and its competition watchdog, is already looking at the Redmond, Wash.-based software giant in its own antitrust proceedings. At this point the Commission has two investigations in the works and a third likely to be unveiled later this year. The Brussels-based Commission claims its investigations are technically and legally separate from those of the U.S. Department of Justice. But the antitrust principles spurring both investigations are very similar — illegal maintenance of a monopoly and bundling its products together to the detriment of consumers. The latter concern of the Commission, of course, is what has all but derailed General Electric Co.’s $41 billion acquisition of Honeywell International Inc. The Commission now has two separate proceedings against Microsoft. The first one was initiated in 1998, based on a complaint by Sun Microsystems Inc. that Microsoft was refusing to reveal technical information about its operating systems, which Sun needs to develop its server software. This probe included all the versions of Microsoft’s operating systems then available. The Commission itself launched the second one early last year on Microsoft’s new Windows 2000 product. Now, Brussels is putting out feelers on Microsoft’s latest XP product, due for release later this year, although no formal probe has been launched, according to sources. The Commission is considering combining the first two investigations. And it may keep any probe on XP separate to avoid delays on the older charges, according to sources close to the Commission. The Commission has already confirmed its charges in the 1998 investigation by sending what is known as a statement of objections — a legal document outlining the EU’s arguments. The Commission is now deciding on whether to send a second statement on the Windows 2000 probe, sources said. The next step would be for Microsoft to present its defense to the Commission at closed hearings in Brussels. Thursday’s ruling in Washington could clear the way for the Commission’s own investigations to begin in earnest. As one Brussels-based competition lawyer pointed out, because the U.S. court left open the question of ultimate remedies, Brussels is free to proceed with its own findings. Commission spokeswoman for Competition Amelia Torres Friday declined to comment on the U.S. ruling. “The Commission will not make a comment on a foreign court ruling,” she said. “We are still studying the ruling to assess whether there are possible implications for our own investigations.” In Washington, the U.S. Court of Appeals for the D.C. Circuit ruled that Microsoft had repeatedly violated the Sherman Antitrust Act by improperly attempting to maintain its monopoly in operating systems. In remanding the case to a new judge in a lower court, the appellate judges also gave the DOJ the chance to argue once again that Microsoft may have illegally tied its Internet Explorer Web browser to its Windows operating system. Yet the U.S. appeals court ruling will not necessarily light a fire under the EU’s investigations of Microsoft. Brussels is unlikely to significantly speed up the snail’s pace of progress in what’s proven a highly complex probe. Moreover, antitrust experts in Brussels believe the Commission would be unlikely to move until Microsoft and the U.S. Department of Justice decide their next courses of action. The two sides could settle out of court, the DOJ could appeal the ruling or the case could go back before a new lower court judge. The Commission, of course, insists the Microsoft antitrust cases on both sides of the Atlantic are separate. European Competition Commissioner Mario Monti in a press conference in Brussels in May most recently said that hearings would “not take place before some months’ time.” Copyright (c)2001 TDD, LLC. All rights reserved.

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