Microsoft has created a special software licence for Windows 98 and Windows 2000 that allows charities and schools to use second-hand PCs without breaking the company's end user licence rules.

As pressure increases on businesses to recycle or refurbish their old PCs, a greater number of systems are finding their way into the hands of charitable organisations and educational institutions. The catch is that because the computers were sold with a corporate licence, it is effectively illegal for the charities make use of the computers without falling foul of Microsoft's licence agreement.

To address this issue, the company has launched the Microsoft Authorized Refurbishers (MAR) programme, which allows selected companies to install and updated version of either Windows 98 or Windows 2000 to the computer for a "nominal charge" to cover "materials and program operations".

Elena Bonfiglioli, Microsoft's corporate social responsibility and community affairs director, said in a statement that the programme will extend the life of PCs and help increase access to technology. She said MAR will "maximise IT access in schools and community centres to support more education for all and minimise the environmental impact of redundant hardware.”

Three years ago, Microsoft caved in to pressure after it demanded that an Australian children's charity buy new licences for donated computers. Eventually, the software giant offered to donate 150 packs of Windows 95 and 10 refurbished computers as a "gesture of goodwill".

ZDNet Australia's Megan McAuliffe contributed to this report.