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EU Fine Against Microsoft Could Top $530 Million

Microsoft should know the end of July whether it will be nailed with a massive fine for not complying with the European Union's 2004 ruling.
The head of the European Union told reporters Tuesday that she would decide by the end of July whether Microsoft will be nailed with a massive fine for not complying with the EU's 2004 ruling.

Competition Commissioner Neelie Kroes of the Netherlands told the Associated Press that she and her regulators were waiting to see what progress Microsoft had made in meeting earlier EU objections to how it was delivering documentation on Windows server software protocols to rivals.

"We have made the agreement with the board of Microsoft that they should fill in their homework," Kroes was quoted by the AP. "They have to deliver before the summer break, so let's wait."

Kroes also said that her commission's trustee -- British computer scientist Neil Barrett -- who has been overseeing Microsoft's compliance with the original 2004 antitrust ruling, had told her that the American company was "active" in updating the documentation.

In December 2005, the EU antitrust agency told Microsoft to simplify and expand the technical documentation or face a 2 million-euro-per-day fine ($2.6 million). Then, Kroes said the fine would be retroactive if it was eventually applied; she stuck to that Tuesday.

Microsoft refuted the EU claims in a hearing before the commission in late March, and a month later, appealed the original ruling to a European court. The latter may not be decided for a year or more.

If Kroes sticks to schedule and on July 31 rules that Microsoft must pay the fine, the total bill would be 414 million euros ($531 million), nearly as much as the $600 million fine applied in 2004. The $531 million would amount to about 4 percent of Microsoft's 2005 annual revenues.