Microsoft and the European Commission have resumed talks to resolve a dispute over the software company's bundling its Internet Explorer browser with the Windows operating system.
In 2004, the EC was successful in its monopoly abuse case against Microsoft for linking its media player to Windows, fining the software-maker Euro497m (£430m).
The EC is threatening sanctions if it fails to reach an agreement on the browser with Microsoft, which has been accused of harming browser competition with its bundling practices.
The latest talks could be the last chance for a truce before the EC takes punitive action. Two previous attempts at settlement have failed, according to the Financial Times.
The EC wants Microsoft to give Windows users a wider choice of browsers and is threatening to force it to do so and may impose a hefty fine talks do not lead to an agreement.
In June, Microsoft announced it will release a browserless version of Windows 7 later this year in an attempt to win favour with the EC.
But the EC said the move will provides less choice instead of more and a European group of technology companies opposed to Microsoft said the measure did not go far enough.
Instead, the EC is pressing for Microsoft to allow Windows users a bigger choice of browsers by either allowing users to download alternatives or bundling rival browsers with Windows.
The EC charged Microsoft with anti-competitive behaviour after a year-long investigation in response to a complaint by Norwegian browser development firm Opera Software.
In its December 2007 complaint, Opera called on the EC to compel Microsoft to give consumers a real choice of browser.