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May 28, 2017

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China confirms Microsoft probe for 'monopoly' actions

SHANGHAI -- China is investigating Microsoft for allegedly operating a monopoly in its market, the government said Tuesday, as it took aim at the U.S. software giant over business practices.

The move makes the company the latest foreign firm to face Beijing's scrutiny, in fields ranging from computing to baby milk.

"According to legal regulations, the SAIC (State Administration for Industry and Commerce) has set up a case to investigate Microsoft for alleged monopoly actions," the agency said in statement on its website.

The probe centers on its Windows operating system — which is used on the vast majority of computers in China — and the Office suite of programs, the statement said.

An earlier inspection last year considered allegations by companies that Microsoft bundled its products for sale and failed to disclose information about the software, causing problems with compatibility, it added.

The SAIC could not "eliminate the suspicion that Microsoft's ... actions are anti-competitive," the statement added.

In May this year, China banned the use of Microsoft's Windows 8 operating system on all new government computers, amid reports alleging security concerns. That followed the United States indicting five members of a Chinese military unit for allegedly hacking U.S. companies for trade secrets.

The announcement came after Microsoft said Monday that it was under investigation in China, without disclosing details, following state media reports that authorities had visited four of its offices.

The SAIC said it was questioning senior management staff of Microsoft China, including a vice president, as well as marketing and finance employees, but did not name them.

Microsoft did not immediately respond to a request for comment.

In an earlier statement on Monday, the company said: "We aim to build products that deliver the features, security and reliability customers expect, and we will address any concerns the government may have."

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