The binding agreement lets computer users in Europe who buy new hardware based on Microsoft´s Windows operating system choose which browser they want to install at set-up -- including rivals to Microsoft´s Internet Explorer.
A similar informal undertaking was also accepted covering choice for Windows users in relation to other PC software and applications, meaning peace has broken out after years of massive fines backed by an EU court.
The decision, which will be implemented for five years from mid-March 2010, represents "a Christmas present for hundreds of millions of Europeans," EU Competition Commissioner Neelie Kroes told a press conference.
"We will just look over what is left, shall we say," when asked what outstanding issues remain on the table. "Microsoft is well aware, in competition terms, what has to be avoided," Kroes underlined.
Brussels threatened litigation in January this year, saying consumers were not being allowed to make an "unbiased" choice between Microsoft´s software and those of rivals including Mozilla´s Firefox, Google´s Chrome or Opera.
Now, buyers of 100 million new personal computers in the European Economic Area, the 27 EU nations plus Iceland, Liechtenstein and Norway, will see a simple "choice screen" when they first configure the machine.
Brussels said the result "legally binds Microsoft to the commitments it has offered and ends the commission´s investigation" into whether the company had abused its dominant position, and will be reviewed within two years.
The decision concerns computers running Windows XP, Windows Vista and Windows 7 and marks a step-change in Europe with strategic implications for Microsoft, the world´s dominant computing company, in other regions.
Computer users are already able to download and install different browers, but Kroes said this deal would "act as an incentive for web browser companies to innovate and offer people better browsers in the future."
"This is a victory for the future of the Web," said Jon von Tetzchner of Norway´s Opera, which complained about restrictions in December 2007 and is at the forefront of developing software accessible via the ether, or ´cloud.´
"We are embarking on a path that will require significant change," added Microsoft´s Brad Smith. "Nevertheless, we believe that these are important steps that resolve these competition law concerns."
Microsoft´s website also published "an undertaking whereby it commits to make far-reaching interoperability disclosures," or information allowing other applications developers to integrate easily with its suite of programmes.
Fines on Microsoft hit 1.676 billion euros (2.438 billion dollars) during their epic battle. Failure to have cut a deal could have cost Microsoft 10 percent of its global turnover, worth 58.44 billion euros in the year to June.
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