E.U. Wants More from Google in Antitrust Case ; Concessions Made So Far Don't Ensure Fair Shake for Rivals, Regulator Says

By Kanter, James | International Herald Tribune, July 18, 2013 | Go to article overview

E.U. Wants More from Google in Antitrust Case ; Concessions Made So Far Don't Ensure Fair Shake for Rivals, Regulator Says


Kanter, James, International Herald Tribune


The E.U.'s competition commissioner indicated Wednesday that the company still risked big fines over the way it runs its online search business.

Google must offer significantly more concessions to European Union regulators to escape huge fines linked to the way it runs its online search business, the bloc's top antitrust official warned Wednesday.

The comments marked the first time the European authorities have formally said that a deal Google offered earlier this year to settle competition issues was not acceptable. That places the onus on Google once again to address rivals' concerns that the company's search rankings benefit its own services.

"I concluded that the proposals that Google sent to us months ago are not enough to overcome our concerns," Joaquin Almunia, the European Union competition commissioner, told a news conference here.

Mr. Almunia said he had written to Eric E. Schmidt, the company's executive chairman, "asking Google to present better proposals, or improved proposals."

In his letter, Mr. Almunia did not give Google a deadline for offering further concessions, suggesting that the case both sides had hoped to close later this year could continue for several more months, said one person with direct knowledge of the contents of the letter. The person spoke on condition of anonymity because the letter was not made public.

The European Commission, the Union's executive arm, opened a formal inquiry into Google in 2010 on concerns that the company was abusing its dominant position in search. The commission laid out its main points in May 2012, and Google early this year came back with an offer to change its practices in certain search categories, hoping to settle the case and avoid a protracted antitrust inquiry.

Google is trying to work out a deal with Europe that would cause the least disruption to its search business and the advertising it generates, which accounts for much of the company's revenue.

It also wants to avoid a possible fine of as much as 10 percent of its annual global revenue of about $50 billion and a finding of wrongdoing that could limit its ability to expand in Europe.

The company said on Wednesday that it would "continue to work" with the commission to settle the case. But Al Verney, a spokesman for Google, said the package of earlier concessions "clearly addresses their four areas of concern."

Google dominates search in Europe, controlling about 90 percent of that market in some countries, compared with about 70 percent in the United States.

Instead of proceeding with formal charges last year, Mr. Almunia offered Google a chance to reach an amicable solution. But an outcry from competitors to the deal from Google, which the commission began reviewing in April, has put a brake on that effort.

The criticism poses problems for Mr. Almunia. The case is high- profile, and if a settlement fails to placate Google's rivals, they could try to unwind any agreement by suing the European Commission at the General Court of the European Court of Justice in Luxembourg. …

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