Updated China has kicked off an anti-monopoly probe into Microsoft’s business practices and lawsuits from local firms could follow, according to state media reports today.

Several companies are being scrutinised over suspected monopoly activities by China’s State Intellectual Property Office and some research institutions in the country, according to Agence France-Presse which cites Shanghai Securities News.

"On the one hand, global software firms, taking advantage of their monopoly position, set unreasonably high prices for genuine software while on the other hand, they criticise Chinese for poor copyright awareness. This is abnormal."

"With the anti-monopoly law in place, Chinese government and companies have the obligation and right to correct the situation," the source said.

One copy of the Windows operating system bundled with Microsoft Office software can cost up to 7,000 yuan ($1,015) in China, the source said, making it more expensive than a PC.

China’s top legislature – the Standing Committee of the National People's Congress – passed the Anti-Monopoly Law last year, however it doesn’t actually come into effect until 1 August 2008.

Under the new law foreign acquisitions of Chinese companies will be subject to rigorous new checks intended to protect China’s economic security, in a move that has ignited concern among US and European business groups keen to invest in the emerging market.

Microsoft and China’s State Intellectual Property Office could not immediately be reached for comment. ®

Update

China's anti-piracy bureau today (19 June) denied reports it was probing suspected monopoly activities of large software companies including Microsoft.

It said in a statement that state-run newspaper Shanghai Securities News inaccurately reported that an investigation was being conducted by China's State Intellectual Property Office.

"Our office has never conducted research on monopoly behavior aimed at any enterprises," the notice said. "And at present we have no plan to conduct this work," it said.

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