Microsoft on Friday said it would sell its stake in AnyVision, an Israeli facial recognition startup, and said it no longer would make minority investments in companies that sell "sensitive" technology.

Last summer, Microsoft participated in a $74 million funding round for AnyVision, which critics said contradicted the company’s principles. Israeli AnyVision came under scrutiny following media reports that its technology was used to surveil Palestinians who lived in the occupied West Bank.

In October 2019, Microsoft hired former U.S. Attorney General Eric Holder and a team from Covington & Burling to investigate the claims. Covington confirmed that AnyVision technology is used in border crossing check points between Israel and West Bank.

Here is Microsoft's statement:

"After careful consideration, Microsoft and AnyVision have agreed that it is in the best interest of both enterprises for Microsoft to divest its shareholding in AnyVision. For Microsoft, the audit process reinforced the challenges of being a minority investor in a company that sells sensitive technology, since such investments do not generally allow for the level of oversight or control that Microsoft exercises over the use of its own technology. By making a global change to its investment policies to end minority investments in companies that sell facial recognition technology, Microsoft’s focus has shifted to commercial relationships that afford Microsoft greater oversight and control over the use of sensitive technologies."

Microsoft has laid out principles to guide its own development of facial recognition technology, saying it should perform without bias and must not impinge on democratic freedoms.

Microsoft did not have a timeline to share for when the divestment will occur and who will buy its stake.