BRUSSELS: A decade-long tussle pitting Microsoft against European Union competition watchdogs edged towards truce on Wednesday with signs a battle over Internet browsers was coming to an end.

Tweaks to a Microsoft offer to plug rival web software alongside its own Internet Explorer on new computers sold in Europe saw the European Commission announce it would begin market testing for consumers on Friday.

Microsoft said the breakthrough stemmed from "the single biggest legal commitment in the history of the software industry to promote inter-operability" between its products and those of rival developers.

"The commission's preliminary view is that Microsoft's commitments would address these competition concerns and (it) is market testing Microsoft's proposal in light of these requirements," a statement said.

Brussels was concerned that consumers were not being allowed to make an "unbiased" choice between Microsoft's software and related applications, and those of rivals including Mozilla's Firefox, Google's Chrome or Opera.

Welcoming the decision, Microsoft general counsel Brad Smith highlighted "extensive discussions with the commission over the last month, during which we agreed to make numerous changes to improve (our) proposals."

"Today's decision is a significant step toward closing a decade-long chapter of competition law concerns in Europe," he added.

The commission and Microsoft have long clashed over the US company's practice of bundling other software such as media players into Windows.

In September 2007, Microsoft lost an appeal before Europe's second-highest court against a fine of nearly 500 million euros (more than 660 million dollars) that EU regulators slapped on the company in 2004 for abusing its dominant power, partly in the media players market.

In February 2008, the commission hit Microsoft with a further fine of almost 900 million euros for defying its 2004 ruling.

The commission opened the latest front in its epic anti-trust battle with Microsoft in January, threatening litigation on the browser issue.

In response, Microsoft said in August that it would present customers with a "ballot" option, allowing them to choose whether to install IE or another browser on new PCs sold with Windows 7 pre-installed.

The company said improved proposals centred on the inter-operability of applications that apply to Windows, Windows Server, Office, Exchange and SharePoint products.

In a lengthy reaction, it said it would "ensure that developers throughout the industry, including in the open source community, will have access to technical documentation to assist them in building products that work well with Microsoft products."

Thomas Vinje, a lawyer representing anti-Microsoft lobby, the European Committee for Inter-operable Systems, said it hoped that the month-long test period would "prove the settlement sufficiently robust to effectively open the Windows monopoly system to genuine competition."

Added Jonathan Zuck, head of the Association for Competitive Technology: "This solution addresses the commission's concerns while ensuring that software developers can continue using the underlying Internet Explorer code to build their programmes."