“this operation has been canceled due to restrictions in effect on this computer”

If you get the following message when clicking links on Outlook (2003, 2007, 2010):

“This operation has been canceled due to restrictions in effect on this computer. Please contact your system administrator”

It is most likely that your browser’s association has become corrupt in some way.

I found the easiest way to cure this was to ensure the htmlfile registry key was correctly set up:
You will need to open regedit.exe and go to HKEY_Local_Machine\Software\Classes\htmlfile\shell\open\command

There should be a string value inside there called (Default) – in most cases it seems the following should work:
“C:\Program Files\Internet Explorer\iexplore.exe” -nohome

Make sure this is correct, close everything down and restart Outlook.

NB. make sure Outlook is completely closed – ie. OUTLOOK.EXE is no longer in task manager.

Microsoft support issue on the matter.

Usual disclaimer applies. Do this at your own risk. No warranty, etc. etc.