Russia's state anti-monopoly service, FAS, said on Monday it had closed a probe into Microsoft as it had found no violations of antitrust laws over cutbacks in supply of the Windows XP operating system.

The FAS launched a probe against Microsoft in June, saying it thought the company had violated legislation by cutting delivery of Windows XP to Russia both as a separate system and pre-installed on personal computers, as well as in its pricing policy on the product.

The bulk of Microsoft's revenue comes from corporate customers, who make payments on long-term licensing contracts allowing them to upgrade to the newest versions of its software.

However in reality most customers do not upgrade immediately, forcing Microsoft to support older versions of the software.

Microsoft is keen to move customers onto newer versions, both to save on costs and to get them to adopt newer standards and systems that lock them into Microsoft's technologies.

The company has largely stopped selling Windows XP to retailers and major computer makers, forcing customers into using its successor, Windows Vista.

Microsoft is committed to full compliance with the laws in Russia. We are glad that FAS did not find any violation, the company said in a statement.

The president of Microsoft Russia, Nikolai Pryanishnikov, told Reuters the company had provided evidence to FAS that Windows XP was indeed available to customers and said that the company had sold 1.2 million localized Russian copies of the operating system in the 2008 financial year.

We also showed the importance of replacing products by newer versions and this is a normal practice for all companies, Pryanishnikov said by telephone late on Monday.

He said the company would in addition offer customers a free-of-charge exchange of Windows Vista Home Basic and Windows Vista Home Premium for Windows XP Home.

The offer will become available within the next three weeks and last until the end of 2009.

On September 10, the regulator will also consider another case as part of a probe into laptop makers whose machines contain pre-installed Microsoft software.

(Editing by Dan Lalor, editing by Martin Golan)

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