March 24, 2004 6:37 PM PST

House letter: Windows issue 'not a concern' for EU

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Europe plays hardball with Microsoft

March 24, 2004
Editor's note: Microsoft found an unexpected set of friends Wednesday, as 10 members of the House of Representatives' International Relations committee protested the European Union's sanctions against the world's largest software company. In the letter, which follows, five Democrats and five Republicans--none of them from Microsoft's home state of Washington--said the Eurocrats' decision violated the spirit of a 1991 "comity agreement" the Clinton administration renewed in 1998. The agreement encourages antitrust officials on the two continents to work closely together, and generally says that the United States should take the lead in overseeing American companies.

Open letter to European Union Competition Commissioner Mario Monti
European Commission
Rue de la Loi 200
B-1049 Brussels
Belgium

Dear Commissioner Monti:

As members of the House International Relations Committee, we are writing to express our concern regarding the European Commission's ruling in its case against Microsoft and the ruling's potential impact on the U.S.-E.U. Comity Agreement. As you know, we are deeply committed to strengthening transatlantic political and economic relations. Therefore, the potential of a regulatory impediment to the continued vibrancy of American and European industries is of the utmost concern to us.

After nearly 5 years of work, the U.S. Department of Justice, several state antitrust regulators and Microsoft reached a settlement--which was subsequently reviewed and approved by a U.S. court--that addressed and resolved the same matters at issue in the current E.U. proceedings. The court's Final Judgment established a comprehensive regulatory scheme that not only resolved past conduct, but also created a detailed compliance structure to address future competitive concerns that might arise. This regulatory scheme insures that Microsoft can continue to add new features into its products but allows both users and computer manufacturers to hide these additional features and use competing products instead.

The European Commission's investigation of the potential anticompetitive effects of Microsoft's actions, specifically the inclusion of audio and video functionality in Windows operating systems, is difficult to understand in the context of the U.S. Settlement and the U.S.-E.U. Comity Agreement of 1991. Because this exact issue was raised and resolved during the U.S. settlement, it should not have been an area of concern for the E.U.

While we respect that it is entirely within the scope of your jurisdiction to investigate any action by Microsoft, the U.S.-E.U. Comity Agreement codifies the commitment of both parties to seek to avoid conflict in the application of their competition laws, particularly in cases that would directly conflict with or undermine the actions or interests of other nations and even where one nation clearly has jurisdiction. As you know, this Agreement was reaffirmed and strengthened in 1998. We strongly support the principles set forth in that Agreement and consider it of utmost importance that this Agreement is respected in this case as well. We should also note that this case involves a U.S. company, that the complaining parties in the E.U. were primarily U.S. companies and that all of the relevant design decisions occurred in the United States.

We hope that the outcome of the Commission's investigation does not devalue the U.S. Department of Justice's prior settlement with Microsoft and that it respects the principles of international cooperation set forth in the Comity Agreement. In addition, we trust that whatever resolution you find will place a high value on the future of innovation in the software industry And the needs of both European and American consumers. Thank you in advance for your thoughtful consideration.

Sincerely,

Robert Wexler
Peter King
Dan Burton
Gregory Meeks
Steve Chabot
Joseph Crowley
Jo Ann Davis
Adam Schiff
Mark Green
Chris Bell

7 comments

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The number of issues the US government interferes with that are related to companies not based in the US shows how ridiculous this claim is. About a year ago the US took Kazaa to court in the US for breaking US copyright laws, even though it's not based in the US.

Also, since the DOJ did little to punish Microsoft for its abuse of near monopoly power, it's good that the EU took some initiative. Since Microsoft conducts almost 1/3 of its entire business in Europe, the EU definately has a say whether Microsoft has infringed on European laws.
Posted by cokeguy17 (7 comments )
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Europe DOES get it !!!!
Poor little dumb politicians. There isn't one of them who have
any real comprehension of MS"s push for total control of the PC
environment. And Ballmer makes with the crocodile tears crying
'Unfair, unfair' while he and Bill continue bundling the universe
into whatever MS's operating system is called nowadays.
Posted by Earl Benser (4310 comments )
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Good luck...
...convincing the European Union of anything remotely related to working cooperatively after the unilateral military moves of the US against Iraq. The US House calling the EU on the floor for this ruling after our moves in Iraq is the single most hypocritical thing that I've seen yet come out of Washington.

Good job guys....

JB
Posted by (4 comments )
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Where were these people in the Lindows case?
If they really feel this strongly, where were they when Lindows business was seriously crippled in the EU by a judgement granted to MS. That ruling was counter to a preliminary finding by the judget in the US.

Considering the size of MS and the terms of the EU judgement, this won't seriously damage MicroSoft. The judgement against Lindows was much more detrimental to that company.
Posted by (4 comments )
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US justice dept is a bunch of Big Mac munching surrender monkeys
Being a European, I am surprised and disgusted by some of the comments from the US dept of justice and politicians on Capital Hill bellyaching that this had already been dealt with by the US courts.

In the eyes of many people this isn't true. Despite a finding of fact against the company, it has been able to substancially influence the remedy process. I think that they sound like paid shills or in the case of the dept of justice a bunch of Big Mac eating surrender monkeys. What abut the interests of other American companies like Sun, IBM, RedHat, Apple or Real Networks?

I would have liked to have seen Microsoft's products being exempted from the 'stateof the art defence' extended to technology companies, full free documentation online of all Microsoft application APIs and opening up data formats such as .DOC, Active X, .PPT, .XLS, C Sharp. This would not only iimprove competition, but also facilitate an ecosystem of developers that could build complementary products without having to use Microsoft development tools and facilitate new products on other platforms such as Linux.

It is no coincidence that Microsoft has donated well and donated often to politicians on Capitol Hill and that it spends millions of dollars on lobbyists. Microsoft has been responsible through its actions for a shocking amount of distruction of value and innovation through anti-competitive practices. The European court judgement does not even take into account outrages like the IP theft alleged in the current Microsoft v Burst Networks case.

The crusade for innovation and competitive markets is the like the war against terror, you are either with us or part of an axis of economic evil. The US needs to decide whether it wants competitive markets or political and economic isolation.
Posted by gedcarroll (3 comments )
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Arrogant Fools
What a bunch of controlling pigs. How dare they dictate
what the Europeans have on their computers!
Posted by LinuxRules (222 comments )
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Seriously bad for business
Microsoft's intereference within our government is seriously bad for business. They need to get out of our governmental affairs - they are not elected, they are a corporation - not government.

These politicians should stay out of corporate affairs as well. It is just another examploe of the influence of money and the suction that exists between politicians, greenbacks, and their "opinions".

Bad day for our government. It is supposed to represent you and me, not a corporate body.

Over and out.
Posted by (2 comments )
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