Microsoft has been threatened with backdated fines of up to €2m (£1.37m) a day by the European Commission after Brussels claimed the software giant had failed to comply with a legal ruling.

The company immediately said it would contest what it called an "unjustified" decision and accused the Commission of moving the goalposts.

In a landmark ruling in March 2004, the world's biggest software group was found guilty of abusing its dominant market position. It was fined €497m and ordered to open up its operating systems. Microsoft was also ordered "to disclose complete and accurate interface documentation which would allow non-Microsoft work group servers to achieve full interoperability with Windows PCs and servers".

The company's appeal was rejected by the Court of First Instance, which told it to comply by December 15 or face a daily fine. The Commission said yesterday the software giant had failed to abide by the ruling and had submitted technical documentation "totally unfit at this stage for its intended purpose".

The monitoring trustee, British professor Neil Barrett, said: "Any programmer or team seeking to use the technical documentation for a real development exercise would be wholly and completely unable to proceed. Overall, the process of using the documentation is an absolutely frustrating, time-consuming and ultimately fruitless task."

Microsoft claims the Commission hadn't properly reviewed its data yet. It has a second appeal pending. Giving it five weeks to comply or face daily fines of €2m backdated to November 5, Competition Commissioner Neelie Kroes said: "I have given Microsoft every opportunity to comply with its obligations.

"However, I have been left with no alternative other than to proceed via the formal route to ensure Microsoft's compliance." Microsoft, which has been battling with the Commission for four years, insisted it had done everything it was obliged to do, and said any more would violate its intellectual property rights. To disclose further source code to rival server makers "can open the door to the production of clones of parts of the Windows operating system".

General counsel Brad Smith pledged: "We will contest today's statement to the full extent permitted under EU law, including a full oral hearing. We have now responded to more than 100 requests from the Commission. We continue working quickly to meet the Commission's new and changing demands.

"Yet every time we make a change, we find that the Commission moves the goalposts."

The Commission said Microsoft had the right to seek an extension of the five-week deadline and would be able to challenge the level of any fines in court.