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Last Updated: Thursday, 25 March, 2004, 12:01 GMT
How Microsoft's fine would be spent
Microsoft must pay almost 500m euros (331m) to the European Commission for abusing its dominant market position. What will happen to the money?

When it comes time for software giant Microsoft to pay a record anti-competition fine - should their appeal against the decision come to nought - the money, all 497m euros of it, will go into the European Union's general budget.

This is the pot of money which EU members contribute to, and from which funds are doled out to the member states.

Quite a windfall, it would seem. But it will be some time before the fine is paid - if at all - as Microsoft's legal battle could take up to seven years to resolve.

By then, membership will have swollen from 15 countries to 25, with Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia all joining on 1 May.

And the EU deals in big money - the fine will be but a fraction of the EU's annual budget, currently about 100bn euros.

Farmer in a field
Where most of the money goes

Almost half of this is spent on agricultural aid, for subsidising farmers and their produce, and for improving rural development.

The second biggest portion - about one-third - goes on EU funding, which supports the poorer countries in the union. Currently Ireland, Spain, Portugal and Greece benefit most from this fund.

Money has also been allocated for the 10 countries set to join the union - some 40bn euros in the first three years of enlargement, in which time these countries will pay 15bn euros into the EU budget.

The remainder goes on research and educational programmes, aid to regions outside the EU such as Africa and the Balkans, and administration costs - of which a portion will be spent on computers and software... Microsoft software.

"Of course we use Windows and XP," says an EU spokeswoman. "Just like everybody."

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