Germany’s antitrust watchdog has launched a probe into Microsoft [MSFT:US] to assess its power in the market, with the potential of implementing regulatory measures against the US tech giant, as reported by Financial Times on March 28. The German regulator, or Bundeskartellamt, will examine whether Microsoft should be designated of “paramount significance for competition across markets”. This is the first step in a two-part process and does not currently involve an examination of specific practices at the company, according to the regulator. However, if complaints or other information indicate that Microsoft engages in potentially anti-competitive practices, a separate decision in this matter will be made after consulting with the European Commission and possibly other competition authorities.

Bundeskartellamt invoked Section 19a of the German Competition Act in its investigation of Microsoft. Effective from January 2021, the groundbreaking law empowers the regulator to prohibit companies that are ruled to be of paramount significance for competition across markets from engaging in potentially anti-competitive practices. These practices include ranking their services ahead of rivals, refusing rivals access to data, and prohibiting users from transferring their data to competing services. Bundeskartellamt explained that a company could be deemed of paramount significance for competition across markets if it has created a “digital ecosystem which extends across various markets”. Since the law came into effect, Google-parent Alphabet [GOOG:US], Meta [META:US], and Amazon [AMZN:US] have been designated of paramount significance for competition across markets. Amazon has appealed against the finding.

Sources:

https://www.ft.com/content/d55e892b-7def-4389-9bb2-7de48bf42c45

https://www.reuters.com/technology/german-regulator-launches-antitrust-proceedings-against-microsoft-2023-03-28/