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<h1>The EU's relationship with Microsoft</h1>
<p>
The FSFE has <a href="/news/2014/news-20140708-01.html">recently expressed its concern</a>
for the lock-in into Microsoft software and licenses that the EU
experiences since a number of years. To understand the issue, it
is helpful to develop a basic understanding of how the EU awards
its IT contracts.</p>
<p>As the EU is a public institution financed by the people, it is
required to allocate its resources in a fair and transparent way.
In terms of IT contracts, this means that the EU is supposed to
consider alternating solutions fairly and competitively in
order to arrive at the best solution possible.</p>
<p>The process described above carries the name "Open Call for Tender".
It essentially means that the EU announces its requirements for
specific IT solutions, and providers of said solutions apply and
compete in order to be chosen. This, of course, includes providers
of <a href="/freesoftware/basics/4freedoms.html">Free Software</a>.</p>
<p>Despite the abovementioned procedure, the EU has repeatedly entered
contractual agreements with Microsoft through a process called
<a href="http://ec.europa.eu/dgs/informatics/procurement/negproc/index_en.htm">'negotiated procedure'</a>.
What this means is that a deal is made without the required level
of competitiveness, with questionable arguments.</p>
<p>The overview provided below is a list of all the contractual
obligations with Microsoft the EU has entered in recent years.
It is meant to show the extent of the issue in financial terms
and the questionable argumentation given by the EU.</p>
<hr />
<p><h4>Contract:</h4><a href="http://ted.europa.eu/udl?uri=TED:NOTICE:140672-2014:TEXT:EN:HTML">DI/07280 (Interinstitutional Licensing Agreement)</a></p>
<p><strong>Date:</strong>15.04.14</p>
<strong>Large Account Reseller (LAR):</strong>
<p>Microsoft Ireland Operations Limited
70 Sir John Rogerson's Quay
Dublin
IRELAND</p>
<p><strong>Purpose:</strong>
The subject of the contract is the acquisition of Microsoft licenses —
the purchase itself is not conducted via this framework contract but a framework
contract with licensing solutions provider (large account reseller).
</p>
<p><strong>Justification:</strong>
"The works/goods/services can be provided only by a particular tenderer for
reasons that are: Technical, connected with the protection of exclusive rights"</p>
<p><strong>Value:</strong>
0 EUR As stated in point II.2.1), this contract has no associated financial
value. This is because the products covered by it will not be acquired directly
from the contractor, but under contract DI-07020-00 (large account reseller),
which was awarded following an open call for tenders, or under similar present
or future contracts entered into by the participating EU Institutions, Agencies
and Other Bodies; see contract award notice 2012/S 65-105131 of 3.4.2012 for
further details. Therefore, the present notice is published exclusively for
transparency purposes. In particular, it does not have the effect foreseen in
Article 171(1) of Commission Delegated Regulation (EU) No 1268/2012 of 29.10.2012
on the rules of application of Regulation (EU, Euratom) No 966/2012 of the European
Parliament and of the Council on the financial rules applicable to the general
budget of the Union (OJ L 362, 31.12.2012, p. 1).
</p>
<strong>What's the problem?</strong>
<p>As can be seen from the justification, this contract is a type of
empty shell: While the EU does not purchase anything, it enters an agreement
that grants exclusive rights to providers of Microsoft licenses. No money changes
hands, and no open call for tender (= fair competition) is required (allowed).
The actual licenses are purchased in the contract below.</p>
<hr />
<h4>Contract:</h4>
<p><a href="http://ted.europa.eu/udl?uri=TED:NOTICE:140675-2014:TEXT:EN:HTML">DI/07300 (Microsoft high-level services)
</a></p>
<p><strong>Date:</strong>
15.04.14</p>
<strong>Large Account Reseller:</strong>
<p>Microsoft NV/SA
Corporate Village, Da Vincilaan 3
1935 Zaventem
BELGIUM
</p>
<p><strong>Purpose:</strong>
Microsoft high-level services and consultancy.</p>
<p><strong>Justification:</strong>
"The works/goods/services can be provided only by a particular tenderer for reasons that are:
Technical"</p>
<p><strong>Value:</strong>
44 000 000 Excluding VAT</p>
<strong>What's the problem?</strong>
<p>This is the contract in which the licenses that were 'pre-selected' in the contract
above are actually purchased.</p>
<hr />
<h4>Contract:</h4>
<p><a href="http://ted.europa.eu/udl?uri=TED:NOTICE:105131-2012:TEXT:EN:HTML">DIGIT/R2/PO/2011/079 LAR 2011 — various supplies
</a></p>
<p><strong>Date:</strong>
01.02.12</p>
<strong>Large Account Reseller.</strong>
<p>Hewlett-Packard Belgium BVBA/SPRL
Hermeslaan 1a
1831 Diegem
BELGIUM
</p>
<p><strong>Purpose:</strong>
The objective of this call for tender, CFT-LAR 2011, is to establish a
framework contract for a single source purchase channel, covering the acquisition
of Microsoft software products and licences under an interinstitutional licensing
agreement, with a large account reseller (LAR).
</p>
<p><strong>Value:</strong>
50 033 804,09 EUR</p>
<strong>What's the problem?</strong>
<p>This contract is problematic because it establishes a 'single source purchase channel'
with HP, which is a blatant abuse of the concept of a call for tender for what is actually
a negotiated procedure. Put differently, the EU ignores its duty to award its funds in a
fair and competitive way by going straight to HP.</p>
<hr />
<p><h4>Contract:</h4>
<a href="http://ted.europa.eu/udl?uri=TED:NOTICE:320241-2010:TEXT:EN:HTML">DIGIT/R2/PN/2010/101</a></p>
<p><strong>Date:</strong>
21.10.10</p>
<strong>Large Account Reseller (LAR):</strong>
<p>Microsoft NV, The Corporate Village, Da Vincilaan 3, 1935 Zaventem, BELGIUM.
</p>
<p><strong>Purpose:</strong>
Ceiling Increase of Contract DI/05950</p>
<p><strong>Justification:</strong>
"e) Additional works/deliveries/services are ordered under the strict
conditions stated in the Directive. The conditions set in the abovementioned
provisions for the use of the negotiated procedure are met as follows:
1. the present ceiling increase procedure aims at acquisition of additional
services not included in the project initially envisaged and indeed through
unforeseen circumstances these have become necessary for the abovementioned
projects, whereas the use of Microsoft tools was decided after the signature
of the present contract;
2. the ceiling increase concerns the acquisition of additional services, which
cannot be economically separated from the main contract;
3. this procedure has the objective to increase the ceiling of the framework
contract DI/05950 by 1 920 000 EUR, which does not exceed 50 % of the original
ceiling, i.e.: 5 368 000 EUR."
</p>
<p><strong>Value:</strong>
1 920 000 EUR, excluding VAT.</p>
<strong>What's the problem?</strong>
<p>This contract is a ceiling increase, which means that the amount of money
allocated to a previous contract is increased. The lock-in that the EU finds
itself in gives the sole provider of its IT infrastructure the power to abuse
its position to request additional funding.(?)</p>
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