The UK government has selected Open Document Format (ODF) over Microsoft for in-house use.
The adoption was announced by Cabinet Office Minister Francis Maude who said ODF covers all government needs.
He said: "Our long-term plan for a stronger economy is all about helping UK businesses grow. We have listened to those who told us that open standards will reduce their costs and make it easier to work with government.
"This is a major step forward for our "digital by default" agenda which is helping save citizens, businesses and taxpayers £1.2bn over this Parliament."
The use of the standard comes in now and will see ODF used for sharing and collaborating on government documents.
Rafael Laguna CEO of Open X-change also commented on the move.
He said: "The move to the ODF file formats improves the flow of information and access to democratic participation as well as ensuring that public resources are not held to ransom at the whim of a particular software vendor. This move can have both financial and public engagement benefits for the UK government.
"But old habits die hard, and it may take some time for these guidelines to have an impact. The German Federal Government adopted ODF file formats in 2008, and the transition has been a slow one. As long as Microsoft Office has a home on government PCs, proprietary file formats will remain a fact of life."
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