Abuse of Economic Dependence - The Centre for European Policy ...

12 A Gap in the Enforcement of Article 82
indispensable for competitors operating in that market. Microsoft’s refusal
limited technical development to the prejudice of consumers, in contradiction
in particular to Article 82(b). If competitors had access to the refused
information, they would be able to provide new and enhanced products to
consumers. The Commission further considered that Microsoft’s refusal to
Sun was part of a general pattern of conduct. It also asserted that
Microsoft’s conduct involved a disruption of previous, higher levels of
supply, and caused a risk of elimination of competition on the work group
server operating systems.
As regards tying, the Commission argued that Microsoft infringed
Article 82 by tying WMP with the Windows PC operating system
(Windows). The Commission based its finding of a tying abuse on four
elements: (i) Microsoft held a dominant position in the PC operating system
market; (ii) the Windows PC operating system and WMP were two separate
products; (iii) Microsoft did not give customers a choice to obtain Windows
without WMP; and (iv) this tying foreclosed competition. In addition, the
Commission rejected Microsoft’s arguments to justify the tying of WMP.
The Commission argued that the tying of WMP to Windows foreclosed
competition and afforded Microsoft unmatched ubiquity of its media player
on PCs worldwide.
The CFI argued that the refusal by an undertaking holding a dominant
position to license a third party to use a product covered by an intellectual
property right could not in itself constitute an abuse of a dominant position
within the meaning of Article 82. It was only in exceptional circumstances
that the exercise of the exclusive right by the owner of the intellectual property
right might give rise to such an abuse. It added that the following
circumstances, in particular, must be considered to be exceptional:
• in the first place, the refusal relates to a product or service indispensable
to the exercise of a particular activity on a neighbouring market;
• in the second place, the refusal is of such a kind as to exclude any effective
competition on that neighbouring market;
• in the third place, the refusal prevents the appearance of a new product
for which there is potential consumer demand.
Once it is established that such circumstances are present, the refusal by the
holder of a dominant position to grant a licence may infringe Article 82
unless the refusal is objectively justified. Microsoft did not prove that these
circumstances were not present and there was no objective justification.
The CFI concluded that the Commission analysis of bundling was
correct. The Commission argued that Microsoft had a dominant position
on the client PC operating systems market. The Commission added that
streaming media players and client PC operating systems are two separate