The European Commission (EC) has notified Microsoft of a preliminary conclusion that the company violated EU antitrust rules by bundling its Teams application within its suite of business applications. According to a press release from the Commission, this practice potentially breaches Article 102 of the Treaty on the Functioning of the European Union and Article 54 of the European Economic Area Agreement. These articles prohibit the abuse of a dominant market position to limit fair competition.
In particular, the EC is concerned that Microsoft has given Teams an undue “distribution advantage” by not offering customers the choice to acquire access to Teams independently of subscribing to Microsoft’s cloud-based applications. The investigation into Microsoft’s behavior was initiated in 2020 following a complaint filed by Slack Technologies, which accused Microsoft of anticompetitive behavior. The EC is empowered by Council Regulation 1/2003 to impose behavioral or structural remedies, fines, and penalty payments for violations of EU competition rules.
Microsoft has a history of similar issues. In 2008, the company was fined €899 million for failing to comply with a previous Commission antitrust ruling related to its licensing practices. Although Microsoft has already altered some software bundles to exclude Teams in response to the EC’s proceedings earlier this year, the Commission declared on Tuesday that these changes are insufficient to address its concerns and that further modifications to Microsoft’s conduct are necessary.
The announcement on Microsoft’s preliminary antitrust breach comes shortly after the European Commission informed Apple that it preliminarily found App Store rules to be in breach of the Digital Markets Act (DMA), indicating an ongoing scrutiny on major tech companies regarding adherence to EU competition regulations.