"I hope this decision will make companies think twice beforethey even think of intentionally breaching their obligations oreven of neglecting their duty to ensure strict compliance."
Microsoft said it took full responsibility for the incident,which it has blamed on a technical error. The board cut chiefexecutive Steve Ballmer's bonus last year partly as a result,and also faulted former Windows head Steven Sinofsky who leftthe company last year for unrelated reasons.
The company did not say whether it would challenge theruling, but it is not expected to do so, largely so as not toantagonise regulators.
"We have apologized for it," Microsoft said in a statement.
"We provided the Commission with a complete and candidassessment of the situation, and we have taken steps tostrengthen our software development and other processes to helpavoid this mistake - or anything similar - in the future."
Almunia said regulators may have made a mistake by allowingMicrosoft to police its own behaviour instead of appointing anexternal trustee to ensure compliance with the commitments.
"In 2009, we were even more naive than today," he said.
Microsoft's fine is a good example of the Commission's hardline approach toward companies which disregard rules whetherdeliberately or not, said Charles Whiddington, a partner atLondon-based law firm Field Fisher Waterhouse.