EU says governments could bar Microsoft from bidding

Governments contracting IT work could conclude that Microsoft's antitrust history constitutes "grave professional misconduct" and ban the company, according to the European Commission.

But the Commission said in a statement that Microsoft can't be banned from competing for government IT projects because of the fines that have been levied against it.

The statement, dated June 9, was in response to a question posed by two members of the European Parliament (MEPs) in April. Green Party members Heide Rühle of Germany and Alain Lipietz of France asked the Commission whether Microsoft's antitrust violations would also make the company ineligible to enter bidding under existing financial and procurement rules. The MEPs asked if Article 93 of the European Union's Financial Regulation and other public procurement directives would apply to Microsoft.

Article 93 says that candidates for projects should be rejected if they have been convicted of a criminal offense concerning their professional conduct by a judicial authority or if a contractor can justify excluding them based on "grave professional misconduct."

In a note back to the lawmakers, the Commission said Microsoft is in the clear on one level since Article 93 does not encompass judgments by the European Court of Justice or fines imposed by the Commission due to violation of competitions rules.

Microsoft was fined €497 million (US$770 million) for violation of antitrust regulations in 2004 by the Commission. As a remedy, the company had to sell a version of its operating system without its Windows Media Player and also reveal interoperability information for its Windows workgroup servers.

But the contracting authority is entitled to determine what constitutes "grave professional misconduct," the Commission said.

"The interpretation of the provision would currently require a case-by-case assessment which can only be done in the framework of an ongoing procurement procedure," the statement said.

The guidance is a bit "vague," said Melissa Freeman, spokeswoman for Caroline Lucas, a Green Party MEP for southeast England who supported the query. "They [the Commission] didn't say no, they said maybe or let's see what happens," Freeman said.

Lucas has maintained that Microsoft has hurt consumers through anticompetitive behavior. She supports public research on open-source software, as well as moving the British parliament's IT systems to open-source systems.

When queried Tuesday, Microsoft did not comment on the Commission's statement.

The IDG News Service is a Network World affiliate.