Oracle should remove the key stumbling block to approval of its Sun acquisition by giving Sun's database MySQL to an independent, non-profit foundation, a free software group said on Friday.

The European Union told Oracle earlier this week that it has failed to ease competition concerns over its $7 billion acquisition.

The foundation would preserve MySQL as free software and foster its development, while no proprietary competitor will be able to use MySQL to threaten Oracle's business, Free Software Foundation Europe said.

Oracle wants a quick resolution because it says that Sun, the fourth-biggest maker of computer servers, is losing $100 million a month as rivals like Hewlett-Packard Co and IBM poach customers amid uncertainty about the closing of the deal.

MySQL, which competes with Oracle, is used to run websites operated by companies including Google Inc, Facebook and Inc.

 (Reporting by Tarmo Virki; Editing by David Cowell)