SCO is seeking cash from Linux users

Before now SCO has been pursuing US companies to buy a licence for Linux but now it is extending the licensing program overseas.

SCO said it would probably launch legal action this year against high profile European firms that decline the chance to take out a licence.

The US company has put aside $16m to help fund its global legal fight to win cash back from Linux users.

Rights issue

The money is also being used to fund legal action against IBM which SCO claims has taken some of its intellectual property and used it in Linux.

However, SCO's claim that Unix was the inspiration for parts of Linux are widely disputed.

Many Linux advocates worry that the threat of legal action will scare people off adopting the free-to-use operating system that has become popular recently.

Preliminary hearings in the legal battle with IBM will take place throughout 2004.

The widening of the licensing programme raises the prospect of SCO launching many more lawsuits against end users of Linux that do not take up a licence.

Last year SCO issued letters to more than 1,000 US firms known to be using Linux asking them to take out a licence if they used the disputed elements of the program.

Few are thought to have taken out a licence and so far SCO has not launched legal action against any US end users. SCO's latest move expands the licensing programme to countries outside the US.

SCO is taking legal action against users of Linux, rather than the creators of the software, because of the terms under which the open source program is used.

"We do not want our product, our property, our IP given away for free," said Chris Sontag, head of the SCO Source division seeking licence payments from users.

"We are defending our rights," he told BBC News Online.