The US government have removed IT giant Oracle from a list of approved public-sector vendors. Oracle will no longer receive invitations to tender for public sector contracts. The news follows a legal dispute in which Oracle has been accused of overcharging.

The news will come as a blow to Oracle, as the General Services Administration have now cancelled the GSA IT Schedule 70 programme, which provided the IT firm with $388 million of business in 2011.

The move follows a high profile legal battle between Oracle and the US government in which Oracle agreed to pay a settlement of $199.5 million in compensation.

The bar will come in to effect from May this year, although Oracle will continue to receive upkeep fees for the public sector infrastructure they have already provided.

The GSA has issued a statement in which it said that working with Oracle "was not in the best interests of the government".