Microsoft has altered an agreement with rival software maker Santa Cruz Operation, ending a dispute with European Commission regulators who said the contract hindered Santa Cruz's ability to compete.

The agreement required Santa Cruz to include Microsoft's computer code in its Unix operating system and to pay royalties whether or not it used the code. Santa Cruz also was bound to make its versions of Unix work with programs available in 1987, the commission said. Microsoft's settlement with the European Commission leaves pending a series of investigations into the software company's competitive business practices.

The US Justice Department has accused Microsoft of using its near-monopoly in the operating systems that run personal computers to force computer makers to install its Internet browsing software.

Under the altered contract, Santa Cruz must pay royalties to Microsoft only when it uses the Microsoft Unix code.