Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Critics slam proposed settlement of EC probe of Google’s search and advertising practices, (Mar 27, 2014)

By Lynn Stanton, TR Daily

Joaquin Almunia, Vice President of the European Commission for Competition Policy, is seen as being too soft on Google in the ongoing investigation of alleged anticompetitive actions in its online search and search advertising practices, and is earning his own share of the ire directed at Google by Europeans for invading privacy and evading taxes, according to Gary Reback, counsel at Carr & Ferrell LLP, based in Menlo Park, Calif.

Google recently submitted its third proposal aimed at settling the EC antitrust investigation, which Mr. Almunia said would give users “real choice between competing services presented in a comparable way.”

After market testing of two previous Google proposals showed that changes implemented by Google meant that the language of the proposals didn’t apply to its actual practices, Almunia has said he will accept the latest proposal without market testing, and that only the original complainants will be allowed to comment on the proposal, Reback said yesterday at an antitrust panel organized by FairSearch, which represents Google’s competitors.

“Google has once again changed its practices so that the most important stuff Google does won’t be covered,” he noted.

Another panelist, Jenni Lukander, director-competition law for Nokia Corp., said that Google should be viewed as having dominance in the mobile OS market. She cited Google’s majority market share in the global smartphone operating-system (OS) market and its ability to obtain “anti-fragmentation agreements” with OEMs (original equipment manufacturers) not to produce non-Google devices using open-source Android operating systems.

“It’s absolutely critical to maintain the incentives to innovate in the market, and I think that can be done pretty much by maintaining the level of patent protection we have in the market,” Lukander said. She added that Nokia believes that a “platform-neutral” approach is fundamental to enforcing commitments to license standard-essential patents on F/RAND (fair, reasonable, and nondiscriminatory) terms.

Meanwhile, Consumer Watchdog sent a letter yesterday to European Commission President Jose Manuel Barroso, urging that the “deeply flawed” proposed settlement with Google be modified.

“Much has been made of the idea that Google will be under the supervision of the monitor for five years to ensure the company fulfills the Commitments,” wrote John M. Simpson, the group’s Privacy Project director. “However, to our amazement the Commitments do not actually obligate Google to do anything in response to a request from the Monitoring Trustee. Shockingly, the Commitments leave the decision about whether to comply entirely up to Google.”

Simpson cited a provision of the proposed settlement that says, “Google may comply with any specific request made by the Monitoring Trustee in its sole discretion. The Commission reserves the right to exercise its powers of investigation set out in Section V of Council Regulation (EC) No 1/2003 should Google decline any request made by the Monitoring Trustee.”

Attorneys: Gary Reback (Carr & Ferrell LLP)

News: Antitrust