"Microsoft's dominant position is not in the public interest," wrote Globalisation Institute president Alex Singleton.
"It limits the market and has slowed technical development to the prejudice of consumers."
Singleton claims that Microsoft is able to win over consumers by default, pre-installing its software on so many PCs that users are never properly made aware of the alternatives.
Customers may very well have chosen these alternatives instead of Windows if given the chance, according to Singleton.
To remedy the situation, Singleton proposes that all PCs be sold free of a pre-installed operating system.
This will allow rival operating systems, such as Linux, to openly compete with Microsoft on a much more level playing field.
The proposal would only apply to traditional Microsoft-compatible PCs, and not to Apple hardware, which the group dismissed as a high-performance "niche" market.
"We do not think that the Mac, despite claims of its superiority, provides a meaningful competitive threat to Microsoft," wrote Singleton.
Spokespersons for Microsoft did not immediately return a request for comment on the report.
The proposal was submitted just one week after the European Court of First Insistance issued a €497m fine against the company.
The court also declared that Microsoft had not been properly opening its technology to third party vendors and had continued to leverage its market share unfairly.