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7th Dec 2016

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Brussels silent as Google tries to avoid record EU fine

  • Google faces a near €4bn fine if found guilty of breaching EU competition rules. (Photo: tpholland)

The European Commission is refusing to be drawn on steps made by Internet search-engine Google to avoid an EU fine of up to €3.8 billion for breaching EU competition rules.

Google issued a statement on Monday (2 July) claiming that it had made proposals to the commission in a letter from executive chairman Eric Schmidt to EU Competition chief Joaquin Almunia.

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Almunia had given Google a July deadline to propose reforms to its business practices to avoid full disciplinary sanctions for abusing its 94 percent market share in Europe.

Under EU competition rules, sanctions could include a potential fine of up to 10 percent of Google’s annual turnover of just under €40 billion, comfortably higher than the €1.6 billion fine levied on rival software giant Microsoft.

Google spokesman Al Verney said that the firm, which is also under investigation by the US Federal Trade Commission for allegations of anti-competitive practices, had "made a proposal to address the four areas the European Commission described as potential concerns.”

The most controversial issue at stake surrounds charges that Google is guilty of manipulating search engine results to give unfair preference for its own products.

A commission spokesman confirmed it had received a letter from Google and that anti-trust officials would now analyse the response.

However, details of the letter have not been disclosed and the commission is understood to be in no hurry to take a decision.

The lobby group ICOMP, which represents a number of rival software companies including Microsoft, offered qualified support for the news.

ICOMP counsel, David Wood, said that the move was “a hugely significant acknowledgement by Google of their market dominance and recognition of illegal anti-competitive behaviour.”

However, the group, which has long been critical of Google's dominance of the search-engine market, argued that it was vital to ensure that “the remedies offered by Google end the discrimination and manipulation of search results that have had the effect of making the open Internet a closed Google Internet."

It concluded that Google's proposed reforms required "vigorous scrutiny not only by the commission but also by third parties."

Meanwhile, for her part, Monique Goyens, director general of the pan-European consumer organisation BEUC, released a statement of Tuesday commenting that partial or biased query results which placed Google products above others was "a cause for considerable concern" for consumers.

She called on the commission to ensure that “the offered remedies put an end to manipulated search results."

EU ministers approve 'Juncker plan' extension

The agreement to prolong the EU investment plan until 2020 to raise up to €500 billion will have to be confirmed by the parliament amid questions about its impact and functionning.

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