BEIJING, CHINA - CHINA has begun an anti-monopoly investigation into US giant Microsoft and several other global software firms, the country's intellectual property watchdog said on Wednesday.

The development comes with Microsoft already embroiled in a standoff with the top antitrust watchdog in Europe, where officials have long accused the software titan of abusing its dominant market power.

'Our departments are carrying out the investigation,' a spokeswoman with China's State Intellectual Property Office, who only disclosed her surname, Sun, told reporters.

Her comments confirmed earlier media reports that the anti-monopoly probes had begun.

The reports also said that lawsuits by local companies could follow, but the spokeswoman declined to comment on that or provide more details.

The official Shanghai Securities News reported on Wednesday, citing unnamed sources, that firms would be organised to file lawsuits against the software companies after China's debut anti-monopoly law comes into effect on Aug 1.

The probe by Chinese regulators focuses on operating systems and other software developed by international companies that cost much more in China than in the US, one source was quoted by the Shanghai Securities News as saying.

'One one hand, global software firms, taking advantage of their monopoly position, set unreasonably high prices for genuine software while on the other hand, they criticise Chinese for poor copyright awareness. This is abnormal.'

'With the anti-monopoly law in place, Chinese government and companies have the obligation and right to correct the situation,' the source said.

One set of the Windows operating system plus Microsoft Office software can cost up to 7,000 yuan in China, making it more expensive than a personal computer, the source said.

Beijing-based Microsoft China said it was not aware of an anti-monopoly investigation, but added it 'fully supports China's efforts to establish an environment conducive to promoting fair competition.'

'We believe efforts such as the AML (anti-monopoly law) will better safeguard interests and benefits of consumers, encourage innovation and enhance economic development,' it said in a statement sent to reporters.

China's parliament passed the anti-monopoly law last year, sparking concern among US and European business groups.

The law requires that proposed mergers or takeovers of Chinese firms by foreign companies must be checked to ensure that they do not endanger national security or lead to monopolies. -- AFP