The European Commission said on Thursday that software giant Microsoft had agreed to make "radical" changes to its .NET Passport system to ease concerns about data privacy posed by Internet identity systems.
"Microsoft has agreed to implement a comprehensive package of data protection measures, which will mean making substantial changes to the existing .NET passport system," the Commission said in a statement.
Jonathan Todd, a spokesman for the European Union"s executive body, said it was now unlikely that the Passport system, used to identify Internet users, would fall foul of government data protection rules in the 15-country bloc.
In July, the group had decided to look closer at Passport and other on-line authentication systems such as the one by the Liberty Alliance, which includes Sun Microsystems, amid legal concerns that these systems may violate EU privacy rules.
Microsoft Chairman Bill Gates, on a visit to Brussels, did not answer a reporter"s question on the issue.