China Gives Microsoft 20 Days to Explain Problems
Antitrust Agency Demands Clarity on Compatibility, Bundling
Updated Sept. 1, 2014 6:49 a.m. ET
A Chinese antimonopoly agency has asked Microsoft for an explanation of what it called compatibility and bundling issues. Here, the Microsoft building in Beijing. Agence France-Presse/Getty Images
BEIJING—Chinese officials gave Microsoft Corp. MSFT +1.23% 20 days to explain what they called compatibility and bundling issues with its software, putting pressure on the software maker as it faces an antitrust probe into its business practices here.
The State Administration for Industry and Commerce required the U.S. company to explain "problems like incompatibility and other issues caused by a lack of released information about its Windows and Office software," according to a statement Monday on the agency's website.
The agency said it issued the deadline in a meeting with Microsoft personnel Monday. David Chen, a Microsoft vice president who oversees legal and corporate affairs in China, was among the people in attendance, the agency said.
"We strictly adhere to the relevant laws and rules in China and we have been actively cooperating with the SAIC's investigation," Microsoft said.
The probe has included surprise inspections in recent weeks by Chinese government officials at Microsoft's offices. The SAIC has said it seized email and other material and was seeking to speak with Microsoft executives.
The investigation into Microsoft is one of several faced by foreign businesses in China as Beijing steps up enforcement of its six-year-old antimonopoly law.
Foreign luxury-auto makers are facing probes by another Chinese agency into how they price spare parts and aftermarket services. Chip maker Qualcomm Inc. QCOM +0.24%faces an investigation into its pricing practices and has said it is cooperating.
The SAIC oversees antimonopoly issues that don't involve mergers or pricing, such as potential production agreements or other measures that could give companies too much power in the Chinese market. The agency has released few details into the Microsoft probe, saying that it was responding to complaints from other businesses about Microsoft's Windows operating system and its Office productivity software.
China's state-controlled Xinhua News Agency said Monday that other businesses complained that Microsoft "used tie-in sales and verification codes" with Windows and Office in a way that may have broken the antitrust law.
An SAIC official recently said the agency was also looking into how Microsoft distributes its media player and Internet browser software, without elaborating
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