Trade War


Even as the Bush administration struggles to effect a compromise with the European Union on tariffs to protect its dying steel industry, the EU has fired another salvo in the latest round of Atlantic trade war. This time it is in the high-tech arena.

In August, the EU, having accused the U.S. software giant Microsoft with monopolizing the control of software in the personal computer market, gave the world’s largest software company one last chance to answer its charges. The EU has charged that Microsoft has unfairly crushed competition in this market sector. Failure by the company to reach an accord with the EU will result in the matter being taken to court. By “court,” we mean that lackey of the EU, the European Court of Justice.

The justice dispensed by this particular court is based on a premise far removed from the U.S. judicial system, which is based on the assumption that a defendant is innocent till proven guilty. The EU system is just the opposite—based on the old Roman inquisitorial system of guilty till proven innocent. A victory for the EU is assured within this system should the matter proceed to court.

Already the European Commission has signaled its preparedness to proceed to a court hearing should Microsoft not respond in a manner acceptable to it. The EU spokesman for competition, Tilman Lüder, has declared that the Brussels headquarters of the Union has already prepared a “substantive file” on the matter such that any decision the Commission takes will “withstand the scrutiny of the European Court of Justice” (Deutsche Welle, Aug. 8).

Luder’s warning to Microsoft was dire and threatening. “It would be at the company’s own peril … to ignore this” (ibid.).

The EU is presently in a mean mood, exacerbated by the present impending economic squeeze it faces as a result of recession in Germany and reduced growth in France and Italy—three of its prime member nations, all members of the eurozone. Any penalty it attempts to slam on Microsoft may even pale the multi-billion-dollar fine imposed on the U.S. steel industry into insignificance. This Atlantic trade war is on the verge of heating up!