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China's Microsoft Probe Puts Accenture in Crossfire

The Chinese government has widened its anti-monopoly investigation into Microsoft, raiding more of the company's offices, as well as the offices of one of Microsoft's largest partners.

Last week, antitrust investigators from China's State Administration for Industry and Commerce (SAIC) raided Microsoft offices in Shanghai, Guangzhou and Chengdu. On Wednesday, the SAIC announced on its Web site that it has expanded its probe to include Microsoft offices in Beijing, Liaoning, Hubei and Fujian.

The agency also raided the Dalian office of Accenture, a global IT consulting firm and a strategic Microsoft partner, due to the fact that Microsoft frequently outsources financial work to Accenture. In a statement provided to Reuters, a spokesperson from Accenture Greater China said the company is cooperating with the SAIC to provide "certain information related to one of our clients."

Investigators have also questioned Microsoft Deputy General Counsel Mary Snapp, Reuters said.

The investigations are still ongoing, according to the SAIC, and no charges have been filed so far.

News of the expanded probe comes two days after China issued a strongly worded warning to Microsoft telling the company to stay out of the way of investigators. In the statement, the SAIC urged Microsoft "to strictly abide by Chinese laws" and to "not interfere [or] in any way hinder [the] investigation of the case, to ensure an objective and impartial investigation" (see a Google-translated version of the statement here).

The SAIC has said that it found Microsoft in violation of China's anti-monopoly laws as early as last June. The problem, according to the agency, stems from Microsoft failing to disclose potential compatibility issues with its Windows and Office software.

As one of the fastest-growing consumer economies in the world, China is considered a lucrative market by many multinationals. This is at odds with China's increasing efforts enforce its anti-monopoly laws against foreign companies to protect its citizens from price-gouging.

The investigation into Microsoft is just one of several recent instances of Chinese regulators cracking down on foreign companies. Semiconductor manufacturer Qualcomm was formally charged with being a monopoly by Chinese regulators late last month, for instance, while car makers Chrysler and Audi have been found to have monopolistic behaviors.

About the Author

Gladys Rama is the senior site producer for Redmondmag.com, RCPmag.com and MCPmag.com.