July 1, 2002 5:20 PM PDT

EU looks to wrap up Microsoft probe

WASHINGTON--A top European Union official said on Monday that a ruling in its Microsoft antitrust inquiry will happen by the end of the year.

"We're completing our analysis" in the investigation, said Philip Lowe, the next director general for Competition. The effort has focused on Microsoft's server software and streaming media technology.

Lowe told a conference organized by the American Antitrust Institute that he expected to work closely with U.S. regulators, and he hinted that Europe was waiting for a federal judge to rule on the Microsoft case. A European decision likely will wait "until Microsoft has more clarity on the U.S. side," Lowe told reporters afterward.

He stressed, however, that "we are addressing questions of interoperability, which are not quite the same as the initial judgment and appeal" in the United States. Lowe, previously the director of the EU's merger task force, starts his new job Sept. 1.

U.S. District Judge Colleen Kollar-Kotelly heard closing arguments last month in a case that pitted Microsoft against nine states, which are seeking to levy additional penalties. They've refused to sign a settlement inked in November between Microsoft, the U.S. Justice Department, and nine other states.

Separately, Kollar-Kotelly is also required to decide whether or not the settlement is in the "public interest."

In 1998, the EU began investigating Microsoft after Sun Microsystems complained that its rival would not disclose technical interfaces to Windows NT. Last August, the EU expanded its Microsoft investigation to include a look at how streaming media technology has been integrated into Windows.

Microsoft filed a response to the EU's probe last fall and is awaiting a response. If found guilty of violating European competition rules, Microsoft can be fined up to 10 percent of revenue.

"We continue to cooperate fully with the EU and answer any questions about our products and our efforts to interoperate with other products," Microsoft spokesman Jim Desler said.

During his hour-long speech to an audience of economists and antitrust lawyers, Lowe said that he'd like to see greater congruence of European and U.S. approaches, stressing that while laws may be different, the results have been similar. One difference is that in the EU the government can block a merger through an administrative decision, while the U.S. Justice Department or Federal Trade Commission must go to court.

Microsoft shares closed Monday at $52.66, falling nearly 4 percent amid a broad market decline.

 

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