The European Union will stop Microsoft selling its Vista operating system within EU borders if the software comes bundled with certain browsing, search or security functions. 

Neelie Kroes, the EU's top antitrust regulator, wrote to Microsoft on 20 March expressing her concerns about the new software, according to a report in The Wall Street Journal. 

In an interview with the paper, Kroes said that no decision had yet been taken on whether the EU would hold a formal investigation into Microsoft's Vista software.

Microsoft has already announced that Vista will not be ready until 2007 because of delays in testing.

The EU's worries have been sparked by complaints from rival companies in the software market which feel that Microsoft's next release will have an impact on their products.

Google, for example, is known to be unhappy about the possibility of Internet Explorer 7 pointing users to Microsoft's MSN search engine. 

The Wall Street Journal also claims that antivirus vendor Symantec has complained to EU regulators about the possibility of Microsoft's including antivirus software in Vista. However, Symantec has not issued a formal complaint against Microsoft.

"We are not part of any effort or any organisation advocating that a formal complaint be filed by the European Commission against Microsoft," said the company in a statement.

"Symantec has received and has cooperated with requests for information by the European Commission. We have provided information to assist the government in understanding the complexity of the information security industry and our role in it.

"Symantec's role in this situation is limited solely to its response to inquiries made by the European Commission and goes no further."

Microsoft claims that it will not be adding antivirus software into Vista, although it will include a spyware removal tool called Windows Defender. 

The software giant is still fighting previous actions taken by the EU over its Windows XP software, with private hearings scheduled for 30 and 31 March.

The EU must decide whether Microsoft has complied with the antitrust order from March 2004, and could levy another huge fine if it finds against the company.

Microsoft's appeal against that original antitrust hearing goes to the EU court in Luxembourg in April.