EC Opened Competition Probe into SAP

The European Commission opened an investigation into German software company SAP. The EC suspects potential anticompetitive practices regarding maintenance and support services for its own business management tools.

The EC stated the probe is to assess whether the company has distorted competition in the aftermarket for maintenance and support related to an on-premise type of software, licensed by SAP, after taking issue with certain practices implemented. These include: requiring customers to choose the same type of maintenance and support under the same pricing conditions for all their SAP on-premise software; preventing customers from terminating services for unused software licences; systematically extending the duration of the initial term of licences; and implementing reinstatement and back-maintenance fees.

It further expressed concerns that SAP may have restricted competition from third-party providers, adding that practices implemented by the company constitute exploitative conduct vis-à-vis SAP’s customers that may be qualified as unfair trading conditions. Teresa Ribera, EVP for Clean, Just, and Competitive Transition at the EC, said that with thousands of companies using SAP software to run their businesses, it may have restricted competition in this crucial aftermarket by making it harder for rivals to compete, leaving European customers with fewer choices and higher costs. The EC will now proceed to conduct an in-depth investigation.