The European Union has ruled that Microsoft's bundling of Teams and Office products constituted an abuse of antitrust rules.

• Microsoft was accused by the European Union on Tuesday of violating antitrust rules through the "unfair" packaging of its Teams and Office products.
• The EU raised antitrust concerns about Microsoft's bundling of Teams with Microsoft 365, prompting Microsoft to unbundle the two services. However, the Commission deemed the changes made by Microsoft to be inadequate to address its concerns.

The European Union accused Microsoft on Tuesday of violating antitrust rules through the "unfair" bundling of its Teams and Office products.

The EU's executive arm, the European Commission, has informed Microsoft of its preliminary view that Microsoft has violated EU antitrust rules by linking its communication and collaboration product Teams to its productivity applications in Office 365 and Microsoft 365.

Microsoft was not immediately available for comment when contacted by CNBC.

In an attempt to address antitrust concerns raised by the EU, Microsoft separated Teams from Microsoft 365 in 2020.

The Commission stated on Tuesday that the changes made by Microsoft were not enough to address its concerns and that further changes are necessary to restore competition.

In July 2023, the EU launched an investigation into Microsoft, which is still ongoing, after receiving a complaint from -owned Slack, which competes with Teams.

The European Commission issues a formal step in its investigations by sending a Statement of Objections to the implicated companies, detailing the allegations against them. The companies have the opportunity to respond to the statement.

If the Commission determines an infringement has occurred after companies have responded, it has the power to prohibit the behavior and impose a fine of up to 10% of the company's worldwide revenue.

This is a breaking news story and will be updated shortly.