IBM strikes deal with EU over antitrust complaint

Case focuss on dominant position in the mainframe maintenance market

Computer giant IBM has made legally binding concessions to European Union regulators in order to avoid a fine for anticompetitive practices.

The European Commission opened an investigation into IBM in July 2010 over concerns that it might be abusing a dominant position on the mainframe maintenance market by hindering the access of independent maintenance service providers to critical spare parts.

In September 2011, the Commission consulted interested parties on proposals that IBM had made to resolve the situation. The U.S. company offered to provide certain spare parts and technical information to companies that maintain its mainframe computers under fair and reasonable terms. Wednesday's decision by the Commission makes those IBM commitments legally binding for five years.

The European Commission said it was satisfied that the concessions, which were revised after the stakeholder consultation, were sufficient to address competition issues.

"I am pleased that we could find a swift solution with IBM to our competition concerns. Timely interventions are crucial in fast-moving technology markets," said Competition Commissioner Joaquin Almunia.

Maintenance services for IBM's mainframes are offered both by IBM and by third party maintainers. Independent maintainers need rapid access to spare parts nd technical information in order to compete effectively on this market.

"IBM welcomes this final resolution of the inquiry into certain IBM mainframe maintenance practices and is pleased that the Commission's investigation of the IBM mainframe is now concluded," the company said.

This is the second case involving IBM that the European Commission has completed this year. Software vendors T3, Turbo Hercules and Neon Enterprise Software had made antitrust allegations against IBM, but these were later withdrawn and the Commission closed its investigation in August.

If IBM were to breach its commitments, the Commission could impose a fine of up to 10 percent of IBM's total turnover.

Tags antitrusteuropean commissionIBMlegal

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Jennifer Baker

IDG News Service

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