The European Commission has opened a formal investigation to analyze whether SAP may have falsified competition in the secondary market —the so-called aftermarket— for maintenance and support of its on-premises ERP software in the European Economic Area (EEA). The case, registered under the reference AT.40823, focuses on four practices which, if confirmed, would limit the competition from third-party support providers and might impose unfair commercial conditions on SAP’s customers. The opening, emphasizes the Commission, does not prejudge the case outcome.
The investigation is accompanied by a Preliminary Assessment in which the EU executive summarizes the facts and outlines its competition concerns. From now on, SAP may submit commitments to address these concerns, under Article 9(1) of Regulation 1/2003, a mechanism that allows closing an antitrust proceeding by accepting binding remedies without a formal finding of infringement.
“Thousands of companies in Europe use SAP software to manage their operations, along with the associated maintenance services”, recalled Teresa Ribera, Executive Vice President for the Green, Just and Competitive Transition. “We are concerned that SAP may have restricted competition in this crucial market, making it harder for rivals to compete and leaving European customers with fewer options and higher costs. That’s why we want to scrutinize these potentially distortive practices more closely, to ensure companies relying on SAP software can freely choose the maintenance and support services best suited to their needs.”.
What is the Commission investigating: four practices under scrutiny
SAP, a German multinational specializing in enterprise management software, markets ERP software (Enterprise Resource Planning) that centralizes functions like finance, human resources, or project management. This ERP can be deployed on-premises —on the customer’s own servers— or in the cloud, hosted on SAP infrastructure and delivered as a service. Besides licensing the software, SAP sells maintenance and support (updates, patches, technical assistance) to its corporate clients. Parallel to that, an ecosystem of independent providers exists, offering support services for SAP’s on-premise installations, often with more favorable commercial conditions.
On this terrain, the preliminary investigation identifies four conduct in the EEA —a market where SAP is preliminarily considered to hold a dominant position in the aftermarket for support of its own on-premise ERP:
- Obligation of uniformity and dependence on SAP
The Commission questions whether SAP requires customers to (i) contract support and maintenance for all their on-premises ERP from SAP and (ii) choose the same type of support under the same pricing conditions for all their on-premises ERP. This approach prevents companies from “mixing and matching” (known in business jargon as mix & match) providers and service levels— for example, SAP for critical modules and a third party for others— even if it’d be more convenient for the customer. - Inability to cancel support for unused licenses
The investigation explores whether SAP prevents customers from cancelling support for licenses not in use, leading them to pay for unwanted services. - Systematic extension of initial license periods
Brussels also notes that SAP systematically extends the duration of the initial license period, during which termination of support is not possible. - Re-engagement fees comparable to “what they paid”
Finally, the Commission examines whether SAP charges re-engagement fees and “back-maintenance” fees that, in some cases, would amount to the total paid if they had stayed with SAP all along.
Collectively, these practices could restrict competition from third parties in support of SAP on-premise ERP in the EEA —the so-called secondary market or aftermarket— and, at the same time, amount to exploitative conduct against SAP customers by imposing potentially unfair commercial conditions.
Why this aftermarket matters (and who it affects)
In enterprise software, the lifecycle doesn’t end with deployment: for years, companies depend on updates, security patches, adjustments, and technical support to keep their ERP instance operational. In on-premises deployments, this dependency translates into a secondary market —the aftermarket— where the manufacturer competes with independent providers (TPMs —Third-Party Maintainers—) offering equivalent or alternative services to the official support.
If, in this aftermarket, a provider with a dominant position prevents or raises the cost of combining services or switching providers, the result could be a real reduction in choice for companies and higher costs over the product’s lifecycle. In critical systems like an ERP—the operational and financial backbone—that rigidity affects both SMEs and large organizations, including the public sector.
Legal framework: abuse of dominant position and commitment procedures
The investigation relies on Article 102 of the TFEU, which prohibits abuse of a dominant position when affecting internal market trade and restricting competition. Its practical application is developed by Regulation 1/2003. Under this procedure, the Commission has issued a Preliminary Assessment with the facts and concerns identified. From there, SAP may offer commitments —Article 9(1)— to resolve these concerns and close the case through a decision to accept commitments. Such decision does not infer infringement, but legally binds the company to fulfill what it promises.
The opening of the procedure, in accordance with Article 11(6) of Regulation 1/2003, transfers jurisdiction from national authorities to EU authorities to apply competition rules on the affected practices, and Article 16(1) mandates that national courts avoid decisions conflicting with the Commission’s resolution. There is no legal deadline for concluding a competition investigation: its duration depends on the case complexity, the cooperation of the companies involved, and the exercise of defense rights.
What remedies might be explored (without prejudging the case)
Without predicting the outcome, the set of commitments typically considered by the Commission in aftermarket cases suggests solutions of openness and flexibility:
- Allow “mix & match”: customers can selectively contract support from SAP and independent providers by modules, by environment, or by service levels, without clauses that enforce full uniformity.
- Facilitate partial cancellations: end support for unused licenses or modules without disproportionate penalties.
- Adjust deadlines: prevent systematic extensions of initial license periods that block termination of support.
- Review re-engagement fees: limit reinstalment and back-maintenance fees so they don’t equal ‘everything paid’ in case of no changes, enabling reasonable returns to official support.
In all cases, the goal would be to restore the client’s choice, prevent commercial policies from hindering competition, and protect companies against exploitative conditions.
How cloud computing fits into this picture
The case specifically concerns SAP’s on-premises ERP. However, the sector’s background is a gradual shift toward cloud models (SaaS), where maintenance is integrated into the subscription fee. For this reason, the on-premises market still holds relevance: many companies retain local installations due to regulatory requirements, customization, migration costs, or strategy. The Commission considers that ensuring effective competition also there in the aftermarket is crucial to containing costs and fostering innovation in services.
What can clients and third-party providers expect now
For SAP’s customers with on-premises ERP in the EU, the case’s opening does not immediately change their contracts. However, it provides a window for SAP to offer commitments that might enable them to gain flexibility in support configuration, adjust costs, and align service levels with actual needs. For independent providers, a framework conducive to mix & match and moderated re-engagement fees would strengthen their ability to compete.
It’s worth remembering that the Commission announced it will conduct a priority in-depth investigation. If SAP submits commitments that the Commission accepts, the decision to accept commitments will close the case and legally bind the company. Otherwise, the case will proceed to a final decision (findings of infringement or dismissal), with remedy and sanction options as provided in Article 102 TFEU.
A snapshot of SAP and its market, avoiding oversimplifications
SAP is not a newcomer: it remains one of the global leaders in enterprise management software, and its ERP —in both on-premise and cloud variants— supports critical processes in thousands of European companies. For this reason, the Commission positions its aftermarket policy under the lens of competition law. The key challenge in such procedures is preserving the manufacturer’s ability to innovate —including through comprehensive services— without closing the secondary market or imposing disproportionate conditions on captive customers.
The balance is delicate: to enable the manufacturer to monetize its post-sales know-how while ensuring companies preserve their right to choose and optimize costs with real alternatives. That’s why the case focuses on clauses that, if confirmed, would prevent the mix & match approach, block partial cancellations, or penalize re-engagement.
Next steps
- In-depth investigation by the Commission, with no fixed deadline.
- Possibility for SAP to submit commitments to resolve identified concerns in the Preliminary Assessment.
- Coordination with national authorities and courts, which must avoid decisions conflicting with the Commission’s framework.
- Publication of updates on the Competition webpage of the Commission, with the public record of case AT.40823.
Until a final decision —whether through commitments or at the end of investigation— companies using SAP on-premises ERP in the EU are advised to monitor the case and assess internally what options regarding mixed support, partial cancellations, or cost optimization they’d like to see reflected in their contracts.
Frequently Asked Questions
What exactly is the “secondary market” (aftermarket) for SAP on-premises support and maintenance?
It’s the service market consumed after licensing: updates, patches, technical assistance, and support to keep the on-premises ERP operational. In it, the manufacturer competes with independent providers. The investigation addresses whether certain SAP clauses restrict this competition within the EU.
How could this affect my company using SAP ERP on-premise in the EU?
In the short term, your contract doesn’t change. However, if the case results in commitments or a decision opening the aftermarket, your company could combine providers (“mix & match”), cancel support for unused licenses, and re-engage in official support at reasonable rates, aligning costs and needs more effectively.
What is the difference between a formal investigation and a final decision by the Commission?
The formal investigation (opening of procedure) does not prejudge the outcome. After investigation, the Commission can accept commitments (which close the case without declaring infringement) or make a final decision (finding infringement or dismissal). In the case of commitments, the company is legally bound to fulfill what it commits to.
What kinds of commitments might SAP offer to ensure compliance with EU Competition Law (art. 102 TFEU)?
Without predicting outcomes, typical remedies in aftermarket cases include: permitting “mix & match” services by modules or levels, enabling support cancellations for unused licenses, preventing extensions that block resolution, and moderating re-installation/back-maintenance fees to not dissuade re-engagement. Any commitments should address concerns raised in the Preliminary Assessment.
Case reference: AT.40823 — “Maintenance & support services for SAP on-premises ERP”.
Legal basis: Article 102 TFEU and Regulation 1/2003.
Note: Opening of investigation does not prejudge outcome. Duration depends on complexity, cooperation, and defense rights.
via: European Commission