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EU Steps Up The Pressure: Pursuing Formal Anti-Trust Investigation Against Google

Greg Sterling on November 30, 2010 at 10:25 am

The European Commission has opened a formal antitrust investigation into whether Google abused its market power and position in Europe. A number of complaints have effectively been consolidated in the action, which comes after a preliminary inquiry by the EC. The individual complainants include Microsoft-owned shopping engine Ciao, price comparison site Foundem and French legal site Ejustice.

The EC has been looking into the facts of these cases and has decided there’s sufficient justification to go forward with formal proceedings. According to the release issued by the EC this morning:

The Commission will investigate whether Google has abused a dominant market position in online search by allegedly lowering the ranking of unpaid search results of competing services which are specialised in providing users with specific online content such as price comparisons (so-called vertical search services) and by according preferential placement to the results of its own vertical search services in order to shut out competing services . . . The Commission’s probe will additionally focus on allegations that Google imposes exclusivity obligations on advertising partners, preventing them from placing certain types of competing ads on their web sites . . . Finally, it will investigate suspected restrictions on the portability of online advertising campaign data to competing online advertising platforms

The EC has legal authority to impose fines and demand other remedies if it finds a violation of anti-trust or unfair competition regulations. Google must take the investigation very seriously. The EC was much tougher on Microsoft, in terms of fines and remedies, than the US was after similar findings of anti-trust violations in both jurisdictions.

European regulators have long expressed frustration and concern over Google’s power and influence in Europe. I believe it’s unlikely, however, that the specific claims against Google at issue here will be vindicated. But I also think it’s equally unlikely that the EC will simply find Google “innocent” or without any blame or culpability in this case.

The EC probably wouldn’t have taken the investigation to this level and made such a public announcement if it weren’t intending to do something. What that is precisely remains to be seen pending the outcome of the investigation.

Google has now posted an official comment on the EC action.

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About The Author

Greg Sterling

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.