EU Urges Microsoft to Settle Antitrust Case

The European Union has given Microsoft Corp. (MSFT) until the end of the month to show progress toward complying with terms of the decision in a landmark antitrust case or face punitive sanctions, an EU official said Monday.

"We will take stock after the end of the month," EU Commission spokesman Jonathan Todd said. The EU has within its rights the possibility to fine Microsoft up to 5 percent of its daily global sales for each day that a decision is not applied to its satisfaction.

Todd said negotiations between antitrust regulators from the 25-nation bloc and Microsoft were continuing, but refused to say whether any breakthrough on several outstanding issues was close.

"The contacts are continuing — regular contacts," he said. "I am not qualifying the current state of play at all," he said.

Microsoft shares rose 16 cents to $25.90 in morning trading on the Nasdaq Stock Market.

An EU source said Microsoft was given the June 1 deadline when EU antitrust Commissioner Neelie Kroes held talks with Microsoft CEO Steve Ballmer (search) a month ago. The two met at Ballmer's request to seek a breakthrough in the five-year standoff.

EU antitrust regulators fined Microsoft a record 497 million euros ($624 million) when they ruled in March last year that the company abusively wielded its Windows software domination to lock competitors out of the market.

The orders of the European Commission (search) require Microsoft to share under certain conditions its Windows server code with rivals to make the industry more competitive in the European marketplace. The EU says this has not been satisfactory so far.

Last month, the EU's regulators were still not convinced that the Windows version the company was forced to produce without Media Player was technically up to standard. And questions remained over whether enough had been done to let competitors be interoperable with Microsoft's system.

A partial agreement on the outstanding issues would not suffice, said Todd. "Nothing is resolved until all is resolved," he said in a telephone interview.

Once the deadline gone, "I would imagine we will decide shortly afterward basically whether or not what they offered is sufficient or not. If it is not, then we would initiate a procedure for imposing the daily fines," he said.