Microsoft has warned its European employees that large fines are likely to be imposed this month by European Commission regulators, while assuring them that the company is pulling out all the stops to comply with a two year old EC antitrust ruling.

"One of the EU governments has leaked news that a decision on whether or not Microsoft has complied will come in July this year – and is indeed likely to include a fine," wrote Horacio Gutierrez, associate counsel with Microsoft's corporate and legal affairs department, in an email to all of Microsoft's EMEA employees.

The email was published in full by Microsoft Watch, an industry newsletter.

Microsoft has been accused of foot-dragging over the process of providing communications protocols that can be licensed by competitors to link their servers to the Windows desktop operating system. The EC, an independent trustee approved by Microsoft and a consultant to the EC have all said that the documentation Microsoft provided for the protocols was not usable.

In the email, however, Microsoft said the Commission was to blame for the delays.

"Compliance with this request requires clear articulation of the specific technical requirements by the EU, which has, until very recently, been reluctant to make their demands clear," Gutierrez wrote.

"While we have worked tirelessly with the European Commission on developing technical documentation for the communications protocols, the EU has frequently claimed our documentation is insufficient and that therefore we are not complying with the ruling. They may use this to justify fining us for being in non-compliance with the ruling."

The company has said that after a meeting in March, it finally understood what the Commission wanted, and has been working flat-out ever since. Microsoft was found guilty in March 2004, and lost its appeal in December of that year.

In the email, Gutierrez described the back-breaking labours of "over 300 dedicated engineers" to create the necessary documentation under the Commission's "very aggressive deadlines".

"We have moved every available employee with knowledge of this technology to work on this project, and a great many of them have sacrificed greatly in terms of their personal lives over the last several months," Gutierrez wrote. "This has been a huge challenge for our engineers but they have risen to it, working throughout nights and weekends."

Indeed, Microsoft general counsel Brad Smith told the New York Times last week that "some people are literally spending 24 hours a day at the office".

Unfortunately, so far Microsoft's goodwill has failed to satisfy the Commission, which ruled that Microsoft had used its desktop operating system to illegally boost its position in the server market. Microsoft kept key protocols secret, allowing its own servers to work with Windows desktops in ways that competitors couldn't match, the Commission found.

Microsoft was compelled to release the desktop protocols for license by competitors, but so far its licensing terms have locked out open-source software, which is its main competition. The trustee assigned to the case described the documentation accompanying the protocols as "totally unfit" for use.

A fine appears likely. Several reports citing unnamed sources have said that a draft ruling calls for fines of up to 2 million euros per day, backdated to 15 December, 2005. Commission members are meeting on Monday to discuss the issue and are expected to issue a ruling on 10 July.

"Microsoft has complied fully with every instruction given by the commission," the company said in a statement. "Any fine would be unjustified and unnecessary."