China presses Microsoft in antitrust probe

Inside Microsoft's flagship store...that looks a little like an Apple store
Inside Microsoft's flagship store...that looks a little like an Apple store

Microsoft is in under scrutiny in China, after regulators asked it to explain "major issues" related to antitrust investigation.

The new inquiry comes at the time Microsoft was hoping to improve its position in China, one of its key markets.

The China State Administration for Industry and Commerce Investigation announced Tuesday that Microsoft must answer questions that came to light from data obtained by the regulator. Chinese authorities raided Microsoft's offices in Beijing, Shanghai, Guangzhou and Chengdu in 2014.

"We're serious about complying with China's laws and committed to addressing the SAIC's questions and concerns," a Microsoft spokesperson said.

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China first launched an antitrust probe into Microsoft in July 2014, when it announced it was looking into compatibility, sales and other issues related to Windows and Office software.

The regulatory trouble could be painful for Microsoft, which has made big bets in China in recent years. The company's biggest R&D facility outside the U.S. is in China.

Microsoft announced last month it was setting up a joint venture with China Electronics Technology Group to provide Chinese government and civil service with Windows 10.

On top of that, Microsoft has also sealed a series of deals with prominent Chinese companies, such as UniGroup, Baidu, Xiaomi, and Shanghai Media Group in the fall.

Microsoft is not the only company to find itself under scrutiny in China. Western companies that have in recent months faced regulatory pressures include Qualcomm (QCOM), Danone (DANOY), Mead Johnson (MJN), and GlaxoSmithKline (GLAXF).

-- Jessie Jiang contributed reporting.

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