Microsoft told a South Korean court it wants to drop its appeal against a landmark antitrust ruling by the Korean Fair Trade Commission (KFTC), and the government agency said on Tuesday it was studying the decision.

The U.S. software giant had put in the application to abandon the case to the appeals court last Wednesday, and the court was waiting for the commission's response, an official of the Seoul High Court said.

Microsoft has sought to withdraw its appeal, the company said in a statement on Tuesday.

We are working with the KFTC and the Seoul High Court, but because the matter is pending before the court we cannot comment further.

The commission ruled in 2005 that Microsoft had abused its dominant market position, fining it 32.5 billion won ($35.41 million) and ordering it to separate its instant messaging programme from the Windows operating system.

The commission rejected Microsoft's appeal in May 2006, and then the company took the case to the Seoul High Court.

After the court rejected a stay while the software company challenged the ruling, Microsoft said in October 2006 that it had made changes to its Windows Vista operating system to meet all of the commission's demands.

A court sentencing was set for Wednesday, but it would be delayed until Oct. 25 by when the commission has to say whether it would agree with Microsoft's request, a spokesman for the trust-busting body said.

The agency was undecided on its next step, he added.

It depends on what decision the KFTC will take, the high court official said by telephone, declining to be named. If it rejects that, the court will set a sentencing date again.

Microsoft suffered a decisive antitrust defeat in September when a European Union court upheld a landmark ruling that the world's largest software maker had abused its dominant market position to crush rivals.

The second-highest EU court dismissed the company's appeal on all key points against the 2004 European Commission ruling and upheld a record 497 million euro ($705.7 million) fine.

Microsoft has repeatedly said it had not decided whether to appeal the EU case. ($1=.7042 Euro)

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