The European Union (EU) executive issued the warning after confirming that Microsoft has not implemented the remedy demanded by the EU commission last year for the company's abuse of its dominant position in the server market.

"We remain confident that they will take the necessary steps to remain in line with the commision position," said Jonathan Todd, spokesman for EU competition commissioner Neelie Kroes.

But he reiterated that, if Bill Gates software titan did not comply, the EU had the right to start imposing daily fines of up to five percent of the company's global turnover.

He declined set a deadline, although an EU source said however that the EU expects Microsoft to act within "a couple of weeks."

"The commission remains patient but there are limits to the patience we are prepared to display," Todd said.

Microsoft, the world's leading software maker, was ordered by the EU in March 2004 to disclose information to its rivals in order that their servers could interoperate with Microsoft servers.

The US company appealed against the immediate implementation of that, pending an appeal of the ruling itself, but was ordered in December by the EU high court to implement it immediately.

The commission has since then engaged in market testing -- talking to other players in the industry -- to determine if the way Microsoft was disclosing the information was in compliance with the ruling.

As well as being ordered to change its business practices in moves that strike right at the heart of the company's business model, the EU slapped Microsoft with a 497-million-euro (664.46-million-dollar) fine.

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