Microsoft is facing a £1 billion lawsuit in the UK, accusing the tech giant of using unfair licensing practices to disadvantage rival cloud service providers, including Amazon Web Services, Google Cloud, and Alibaba Cloud. The lawsuit claims that businesses using these competing platforms are charged higher fees to license Microsoft’s widely-used Windows Server software, while those on its Azure platform receive discounted rates.

The legal action, brought by competition lawyer Maria Luisa Stasi, represents thousands of UK firms in an “opt-out” collective claim, meaning affected companies are automatically included unless they choose otherwise. The case alleges that Microsoft’s pricing strategy penalizes businesses for choosing non-Azure cloud providers, coercing them into using Azure and stifling competition in the cloud computing sector.

The UK Competition and Markets Authority is also investigating anti-competitive practices in the cloud industry and is expected to announce its findings soon. Microsoft has not commented on the lawsuit. This follows similar complaints in the EU, where Microsoft previously settled allegations over unfair software licensing practices.