The European Union has launched an investigation into potential anticompetitive practices by SAP.
The European Commission probe focuses on SAP’s aftermarket practices related to its enterprise resource planning (ERP) software, which helps companies manage finances, HR, supply chains, sales and procurement. Despite the investigation, SAP said it does not anticipate any financial impact.
SAP is already embroiled in an antitrust dispute with process intelligence vendor Celonis. In March, Celonis accused SAP of violating US antitrust law and other provisions by making it harder and more expensive for Celonis to access client data stored in SAP’s applications.
Celonis also accused SAP of engaging in increasingly egregious conduct targeting its customers to coerce them into using Signavio, SAP’s own process mining offering.
Is SAP restricting customers?
The Commission stated that SAP may be restricting customers from switching to competing maintenance and support providers for certain parts of their operations as well as preventing them from cancelling services tied to unused software licenses.
Additionally, SAP is said to routinely extend the initial term of its on-premises ERP licenses, during which customers are unable to terminate services. The Commission also criticized SAP for imposing reinstatement and back-maintenance fees on customers who return after a break, charging them as if they had remained subscribed the entire time.
“Thousands of companies across Europe use SAP’s software to run their business,” EU antitrust chief Teresa Ribera said in a statement. “We are concerned that SAP 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,” she said.
SAP responds to EU investigation
SAP said on Thursday that it does not expect any financial hit from the EU probe, reported Reuters.
“We do not anticipate the engagement with the European Commission to result in material impacts on our financial performance,” the company said in a statement. “However, we take the issues raised seriously and we are working closely with the EU Commission to resolve them.”
Why is Celonis suing SAP?
The Celonis-SAP case has been an ongoing story since March. In June, a US court partially dismissed Celonis’ original antitrust claims against SAP, offering Celonis the opportunity to revise and refile the claims. It did so a few weeks later with an updated complaint that built on Celonis’ previous arguments with additional evidence.
SAP has stated that it will not interfere with Celonis data extractor to enable customers to access their own data as the antitrust litigation case between the two companies continues.
“This case is about SAP’s campaign of anticompetitive conduct designed to exclude third-party application and technology providers from its dominant ecosystem, including its acts of tortious interference and false advertising in furtherance of that campaign, in contravention of the promises SAP has made to the market and regulators,” the original lawsuit read.
“No system should hold customers back from transforming their processes,” commented Carsten Thoma, president and board director at Celonis. “Processes should be designed to work best for the company, not the systems the company operates on. That’s why the Celonis platform was designed to help customers optimize their processes to achieve their goals across systems and departments.”