MICROSOFT IS facing accusations of bribery after allegedly selling Office products as a huge discount to a reseller in Hungary which was selling them on at full price.
The Wall Street Journal (paywalled) reports on testimony from “people familiar with the matter” which suggests that this is another case of the company attempting to gain a foothold in developing markets, whilst not playing by the rules.
Just to reiterate for the benefit of the pulses of the INQ legal department (yes, we have one) – that’s a huge ‘IF’.
The case will rest on whether the difference between the purchase price and onward sale price was to allow for bribes and kickbacks being sent to political influencers to try and sway them towards Windows, currying favour against big rivals like IBM and Linux.
Microsoft has been here before, and worryingly for them, it seems that this behaviour, if proved, follows the same modus operandi as previous allegations covering the likes of Italy and China.
Microsoft has come out fighting. It explains that, yes, it knew about the allegations and that it has already dealt with them in their own sweet, fluffy way.
“As soon as we became aware in 2014 of potential wrongdoing in our Hungarian subsidiary, we moved quickly to pursue a detailed investigation and hold people accountable,” said Microsoft in a statement, whilst refusing to hurt any flies in the locale, “We fired four employees and terminated our business with four partners, and we’ve been defending ourselves against legal claims they raised as a result.”
As well as the investigations in Italy and China, there were also enquiries made about operating relationships in Romania. If it really does turn out to be true, it suggests there are systemic cultural forces at work, and the US SEC is going to be very interested in finding out why.
However, for now, neither they, not the Justice Department are commenting, nor would we expect them to at this early stage in investigations.
Besides, Hungary can take it – IBM and SAP were accused of similar crimes back in 2006. μ
Source : Inquirer