Microsoft GmbH, the German branch of the software giant, is denying a report that it might exempt Germany from planned copy protection technology on the upcoming version of the Windows operating system.

The newspaper Financial Times Deutschland (FTD) said in its Tuesday edition that Microsoft is expected to use technology that will prevent the same copy of the operating system, code named "Whistler," from being installed on more than one machine.

But Microsoft spokesman Tomas Jensen, who was quoted in the story, said that no decision has been made on whether to include copy protection in the final version of the softare.

He denied telling the FTD that the company was considering implementing copy protection in other countries, but exempting Germany.

Versions of the Whistler operating system currently in the beta testing phase contain a feature called activation, which when the software is registered links the copy to a particular PC, preventing it from being installed on another machine, PC Advisor sister publication Computerwoche reported last week.

Microsoft has stepped up its efforts against software piracy in recent months, and has introduced a copy protection system in its electronic books software Microsoft Reader.