The European Commission is able to fine Microsoft up to 5% of its daily global sales if it believes the company is not complying with the terms of its March 2004 antitrust ruling, and has given the company until the end of the month to comply with order, according to reports quoting European Competition Commissioner Neelie Kroes.

Microsoft’s chief executive Steve Ballmer is known to have recently met with Kroes, who was quoted as saying that the two had reached a deal that they had until the end of the month to reach an agreement on the way the company does business in Europe.

In March 2004 the EC fined Microsoft 497m euros ($613m at the time, $624m today), but it is the interoperability remedies that are concerning the Commission. In March of this year the Commission’s competition spokesperson, Jonathon Todd, told reporters that on the basis of market test results, the Commission had serious doubts about whether Microsoft is complying with the interoperability part of the Commission’s antitrust remedies.

A Commission spokesperson told ComputerWire at the time that it has four main concerns related to Microsoft’s actions following its market testing: that it is difficult for companies to assess the potential benefits of Microsoft licenses; that customers are required to take out a license to both server and client technologies regardless of their specific requirements; that open source vendors are excluded; and that the level of royalties is unjustified.

Meanwhile, Microsoft could face some of its fiercest rivals as it tries to overturn EU antitrust sanctions at appeal after the European Committee for Interoperable Systems (ECIS), which counts IBM, Oracle, Nokia, Real Networks and Red Hat among its members, was given court permission to join the EC’s appeal at the European Court of First Instance.

The addition of ECIS to the EC’s side will add some technical weight to its arguments after it lost a number of allies to out-of-court settlements with Microsoft. Sun Microsystems famously signed its peace treaty with Microsoft in April 2004, while Novell agreed not to assist the EC as part of its $536m November 2004 settlement with Microsoft.

Nokia, however, quit the Computer and Commutations Industry Association (CCIA) after group president Ed Black reportedly pocketed more than half of $20m payment made as part of the CCIA’s own November 2004 antitrust settlement with Microsoft. As part of that deal, the CCIA also dropped its support for the EC’s action