Microsoft today said it would join HP and other high-tech US firms in signing the US-Europe Safe Harbor agreement on data privacy.

Microsoft is the largest company to sign on to date and will likely add credibility to the self-regulatory measure, which provides a framework to legally and ethically move data between the two marketplaces and promises US companies legal protection from Europe's privacy laws.

"Because our company privacy policies are consistent with the EU principles for data protection, Microsoft is able to sign the Safe Harbor agreement with the US Department of Commerce this summer," Richard Purcell, Microsoft's director of corporate privacy, said in statement.

However the EC and the US have been fighting bitterly over the disparities between the rules laid out by Safe Harbor and some industry watchers feel US firms' ideas of privacy are far more lax than Europe's.

The decision by US organisations to sign the agreement is voluntary, but if they do not sign up by 1 July, they may be subject to enforcement actions in Europe.

From that date, transferring data to the US will be in breach of the EC data protection directive which outlaws the transfer of personal data to countries, including the US, with data protection laws the EC deems inadequate.

Hailstorm, the first step in Microsoft's .Net initiative, will require explicit consent from users before any personal data is transferred. "It will be an opt-in only system," Purcell said.

Internet Explorer 6.0, due out later this year, will also have a more protective approach to personal data than its predecessors. The new browser will give the user an enhanced level of control over the presence of cookies in their computer. "For cookies to remain in the computer will require notification [to the user and their] consent," Purcell said.