Commission to examine European implications

The European Commission yesterday said it would look into whether the US ruling on Microsoft had implications for its own investigations into the company's dominant position.

"If Microsoft is ultimately to be broken up and the source code to Windows is disclosed, I imagine it will have some implications for our investigations, but it is too early to say," said Amelia Torres, Commission spokeswoman. While the appeal process in the US was under way, the Commission would continue its inquiries, she said.

Microsoft said the remedies or sanctions agreed with US regulators would be applied globally. That could remove the need for the Commission to continue its investigations.

The Commission is conducting five inquiries into different aspects of the software giant's behaviour. Three of them relate to the company's dominance of the PC operating market based on complaints from competitors such as Sun Microsystems.

The Commission's latest inquiry was launched in February to examine Windows 2000, and whether the company had extended its dominance into markets for servers that connect PCs to the Internet and ultimately, to electronic commerce.

Mr Mario Monti, the EU's competition commissioner, said at the time: "Whoever is dominant in server software is likely to control e-commerce too." Microsoft responded to the inquiry by e-mail with reams of technical information that the Commission is still sifting through.

A priority for the EU is to examine Microsoft's plan to buy a stake in a UK cable company, Telewest. In March Mr Monti started a four-month probe into Microsoft's $2.4 billion (€2.5 billion) deal to buy 29.9 per cent in Telewest. It was feared that the company could use its position to dominate the market for software used in television set-top boxes.

The Commission is holding the second day of hearings in Brussels today for the company and its rivals to put their cases and discuss the competition issues involved in the deal.