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Google set to avoid massive fines by EU competition regulator

Google set to avoid massive fines by EU competition regulator
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Google seems to have settled a competition investigation by European authorities, so avoiding a fine that could have been as much as 3.5 billion euros.

The probe followed complaints from rivals that the search engine was promoting its own services at their expense.

Google has now offered further concessions and the European Competition Commissioner Joaquin Almunia was satisfied.

He told reporters: “After careful analysis and intense negotiations that managed to further improve what Google sent us in mid-January, I believe today that Google’s new proposals are able – are capable – of addressing the competition concerns I set out to them.”

Brussels will make a final decision after obtaining feedback from Google’s rivals.

Any agreement will only apply to Europe,where Google has a 75 percent share of the search market according to consultancy comScore.

Almunia, who has overseen EU competition issues since 2009, has tended to resolve cases via settlements rather than fines.

Euronews reporters in Brussels James Franey said: “As Almunia’s term nears its end, part of his legacy is to strike this tentative agreeement with the US search giant. The Commission is expected to finalise the deal within the next few months. But the saga does not end there – unhappy competitors may file a legal challenge at the European Court of Justice in Luxemburg.”

Rivals not satisfied

Almunia said he would accept Google’s latest concessions without consulting the complainants, prompting a furious response from critics.

“Without a third-party review, Almunia risks having the wool pulled over his eyes by Google,” said David Wood at lobby group ICOMP that counts Microsoft and four other complainants among its members. Microsoft owns rival search engine Bing.

German online mapping services Euro-Cities said it would take its grievance to the courts.

“Today’s announcement still leaves many questions open. We will continue to take legal action about Google’s business practices in the German and, if necessary, EU courts,” its chief executive Hans Biermann said.

Polish online auction site Allegro was equally critical, saying the deal would not ensure a level playing field for Europe’s internet economy.

Google’s concessions

Under its latest proposals, Google will let three rivals display their logos and web links in a prominent box, and content providers will be able to decide what material Google can use for its own services.

Google will also scrap restrictions that prevent advertisers from moving their campaigns to rival platforms such as Yahoo!‘s search tool and Microsoft’s Bing.

Despite the imminent deal, Google may still face a second EU probe, this time into its Android operating system for smartphones, with potentially bigger risks for the company.

Google gives away Android for free. The software, which is available on three out of four smartphones sold worldwide, essentially helps the company extend its core search business and boost its usage in the mobile world.

Lobbying group FairSearch whose members include Microsoft and Finnish handset maker Nokia, which is being bought by Microsoft, has accused Google of using Android to divert traffic to its search engine.

The European Commission has yet to decide whether to open an investigation into those issues.

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