On October 19th, the EU Commission approved Microsoft’s $7.5 billion acquisition of GitHub, a leading software development platform based in San Francisco. GitHub is a source repository that enables software developers to host and review code, manage projects, and create software. Since Microsoft’s announcement of the GitHub deal back in June, two major concerns surrounded the potential acquisition. First, there were concerns over antitrust issues. Second, it was unclear whether Microsoft’s control of GitHub would compromise GitHub’s open-nature platform. In giving its unconditional approval, the EU Commission decided that “effective competition in the relevant markets would continue and Microsoft would have no incentive to undermine the open nature of GitHub’s platform.”
This is not the first time the EU Commission has closely monitored Microsoft’s actions and placed them under microscopic investigation for anti-competitive behavior. From the 2007 case Microsoft Corporation v. European Commission(alleging Microsoft’s abuse of its dominant market position) to Microsoft’s 2016 LinkedIn Commitments with the EU Commission, the Commission has long been an active check on the leading technology company.
The EU Commission’s unconditional approval of the GitHub deal signifies the crucial role that regulators and international bodies play in creating accountability and transparency between corporate behemoths such as Microsoft and the international markets in which they operate. In this case, the EU Commission could have given an unconditional green light on the deal, conditioned an approval upon further Microsoft commitments (as with the 2016 LinkedIn acquisition), or launched a detailed investigation that could have hindered the progress of the acquisition. Given the backdrop of the EU General Data Protection Regulation (GDPR) that went into effect earlier this year, the role of regulators around the globe is increasingly significant for technology companies that operate in international markets. For companies like Microsoft, it has become necessary not only to acknowledge the authority of these regulatory bodies, but also to ensure their expectations are met for key regulatory approval of critical business decisions.