EU targeting Google’s global business, not only Europe

EU regulators intend to clamp down on Google’s global operations following a probe into search competition, the EU’s antitrust chief said, raising the stakes in forthcoming settlement talks.

EU targeting Google's global business, not only Europe

Google has been accused by rivals of abusing its dominant market position, and the European Commission said in May it was concerned about its alleged anti-competitive behaviour.

The Commission typically looks for concessions that would benefit European consumers, but has on occasions asked for remedies with a broader scope.

“We will look for worldwide solutions, it will not be very useful to get European-wide solutions,” EU Competition Commissioner Joaquin Almunia told a news conference.

We will look for worldwide solutions, it will not be very useful to get European-wide solutions

The Google case is a critical one for Almunia, and his demand for globally applicable solutions – which might see an EU decision serving as a template for worldwide regulators – shows another way in which he is trying to stamp his mark on EU competition policy.

He is also keen for more speed, especially for an industry that is constantly innovating. In May he said he wanted the Commission to get a faster resolution over Google than it has in past cases. One involving Microsoft was brought in 1998 and only received a final court judgment this year.

The EU watchdog has said the Google’s search results may unfairly favor its services over its rivals’ and may have copied material from other websites, such as travel and restaurant reviews, without permission.

Avoid a lengthy battle, avoid fines?

Google is also anxious to avoid a lengthy battle such as Microsoft’s, as well as a penalty: Microsoft was fined more than a billion euros by the Commission.

The company has carefully avoided public confrontation with the Commission, and has tried to build an image in Europe as a sponsor of techy cultural projects.

Global trend

EU Competition Commissioner Joaquin Almunia’s demand for a global solution underscores the global nature of the technology industry, an issue which regulators in different jurisdictions will have to deal with.

“With tech markets, we can expect to see more and more remedies for a global market,” said Mark Tricker, a partner at law firm Norton Rose.”It is in Google’s interest to agree to that. If it is being investigated in other countries, it can then say these concerns have been dealt with in the EU.”

Asked to comment on Almunia’s remarks, Google spokesman Al Verney said: “We are continuing to work cooperatively with the European Commission.”

The Commission said it had reached “a level of good understanding” with Google that would form the basis for technical discussions towards a resolution of its concerns.

Google – to comply with EU demands – has already revised initial proposals to resolve the dispute to cover all platforms, including computers, tablets and mobile devices, someone familiar with the case told Reuters.

Almunia said other parts of Google’s business could still come under scrutiny. “We have not opened any other investigations, but I don’t exclude that in the future other aspects of Google activity can also follow the path of the investigation we launched in 2010,” he said.

He had previously said other complaints related to Google’s top-selling smartphone operating system Android.

Technical details

Regulators will discuss the technical details of Google’s proposals in the coming weeks, though there is no deadline for a decision, Almunia said.

However, analysts cautioned that a statement of objections – a formal charge sheet – remained a possibility despite the apparent progress towards a settlement.

The European Commission can fine companies up to 10% of their annual revenues, which in Google’s case amounts to some $4 billion.

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