Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Attacks on Google’s commitments to resolve EC probe continue, (Jul 24, 2014)

By Jeffrey May, J.D.

One of the complainants behind the long-running European Commission (EC) antitrust investigation into Google’s search practices has once again called on EC Competition Commissioner Joaquin Almunia to reconsider a proposed settlement of the charges.

In February, the EC announced that Google had offered commitments to end an investigation into the company's business practices with respect to online search and search advertising. Under the settlement's terms, the company agreed to guarantee that, when promoting its own specialized search services on its results page, the services of rivals would be displayed in a comparable way. At that time, the EC decided not to market-test the concessions, because it had already sought feedback from interested parties twice on Google’s prior proposals. However, the EC agreed to take feedback from the 18 formal complainants in the case before making a final decision.

As Google's proposed commitments to resolve the competition investigation await sign-off from the College of Commissioners, challenges to the settlement raised by the complainants and others have been constant. Shortly after the proposal was announced, a group known as FairSearch, which represents Google’s competitors, said that the commitments “may be worse for consumers and competitors than doing nothing at all.”

Most recently, the founders of U.K.-based search service and price comparison site Foundem sent a letter to Almunia, reiterating their objections to the settlement. “[A]ll of the Commission’s key arguments for adopting Google’s proposals are erroneous,” according to the July 23 letter.

The Foundem co-founders take issue with the original settlement proposal, arguing that it does not address or mitigate their concerns about Google's alleged abuse of dominance. In addition, they question a June letter from Almunia to his fellow commissioners that purportedly provides the basis and reasoning for adopting the commitments.

Among the commitments offered by Google is a pledge to display rivals to its own specialized search services (services allowing users to search for specific categories of information such as restaurants, hotels, or products) in its results in a way that is clearly visible to users and comparable to the way in which Google displays its own services. The proposed remedy is intended to resolve EC concerns that users might not be aware of the promotion of Google’s services within the search results and that traffic could be diverted away from Google’s competitors towards Google’s own services.

However, a number of objectors to the settlement take issue with Google's ability to force rivals to pay for these links under a “rival link auction” system. The Foundem co-founders contend that the auction-based Paid Rival Links would benefit Google financially and would not serve as a substitute for the free, natural search traffic Google is anti-competitively diverting.

The objections have stalled approval of the commitments and a final action is not expected before late this year. Meanwhile, the EC continues to investigate Google for the California-based company’s conduct that is outside of the competition investigation into search practices.

Companies: Google Inc.

News: Antitrust