The European General Court is making Microsoft Corp. pay €860 million ($1.07 billion) as fine for failing to comply with the European Union’s 2008 request that the software giant share their product information with competitors.

Microsoft wasn’t happy with the decision stating that, in the first place, the EU should not have been allowed to impose a fine back in 2008.  That appeal was trashed by the court but was kind enough to lower the fine from €899 million to €860 million.

“This is a vindication of the tough line that the Commission had taken in enforcing its decision,” said Michael Reynolds, a senior partner with law firm Allen & Overy in Brussels. “It will bolster EU’s regulators’ already very strong powers. Any company in a dominant position that’s under investigation should take note of this.”

Since this whole EU-Microsoft battle started, the software giant has had to pay a total of €1.7 billion in penalties: in 2004 they paid a penalty of €497 million for anticompetitive practices, with a further fine of €281 million for further breaches of competition rules.

European Competition Commissioner Joaquín Almunia stated that the commission’s probe regarding Microsoft’s business practices was fully vindicated as the world would not have seen technological advancements if Microsoft did not allow competitors to view their product information.

This ruling is a warning to all companies who do not practice fair business strategies.

Next on the chopping block

Intel Corp. will be appearing in court on July 3 for in the hopes to overturn the €1.06 billion penalty handed down by the commission in 2009.  The Intel fine is highest value imposed by the EU on a single company.

“In the case of Intel, the issues raised are different from the Microsoft case, [but] both companies maintain that the fines imposed were excessive and disproportionate and therefore unlawful under EU law,” said Suzanne Rab, a partner at King & Spalding, a London-based law firm.

Some are doubting that Microsoft will be appealing the court’s ruling for the simple reason of they’re trying to get on the good side of the commission as they build a new relationship.

“I’d be surprised if Microsoft decided to appeal, particularly now as they want to work building a new relationship with the commission,” said Allen & Overy’s Mr. Reynolds, referring to an ongoing investigation of Google Inc., in which Microsoft is among the chief plaintiffs.

Google is being accused of abusing their dominance over search by squeezing competitors.  Google only has a few days left to answer the commission’s queries and if they fail to give their answers, Almunia could opt to file formal charges against the search giant and fine as much as 10% of their annual global revenue.