Google expected to face antitrust EU charges due to over dominance

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Europe’s competition chief, Margrethe Vestager, is expected to make an announcement that Google has abused its dominant position on Wednesday in Brussels, according to two people who spoke on Tuesday on the condition of anonymity.

The New York Times are reporting that the decision to push ahead with a so-called statement of objections is the latest twist in the lengthy investigation in Google’s activities in Europe, where it holds a roughly 90 percent share in the region’s search market.

If the EU is successful in making its case, the American tech giant could face a huge fine and may be be forced to alter its business practices to give smaller competitors like Yelp greater prominence in its search queries.

Margrethe Vestager, Europe’s antitrust regulator, will visit Washington this week to participate in two antitrust conferences.

Ramon Tremosa i Balcells, a lawmaker from Catalonia in the European Parliament, called for formal charges against Google.

The investigation against Google already has dragged on for nearly five years at the European Commission without formal charges or a negotiated settlement. That delay has prompted criticism that the region’s most important antitrust enforcer has been going too easy on Google.

Europe’s main focus of investigation is whether Google has abused its search engine’s large market share by favoring its own products. The search engine is more dominant in Europe than in the United States, where competitors like Microsoft’s Bing still hold a sizable market share. Ms. Vestager, a Danish politician who took over as Europe’s top antitrust official in November, will travel to Washington later this week, where she is expected to meet senior justice officials and participate in antitrust conferences.

More than two dozen companies and organisations have filed antitrust complaints in Europe against Google. Many are in Germany, where powerful publishing groups and online firms have called on the European regulator to stop the American search giant from blocking competition in sectors like online mapping, travel services and shopping.

“The E.U. competition commissioner, Margrethe Vestager, will decide what steps they want to go,” Günther Oettinger, a German politician who is charge of Europe’s digital economy, told Die Welt am Sonntag, a German newspaper, on Sunday. “I think that they will be far-reaching.”

If Google fails to rebut any formal charges, Ms. Vestager could levy a huge fine that could go above 6 billion euros, or $6.4 billion, amounting to about 10 per cent of Google’s most recent annual revenue. But the largest single fine yet levied in such a case falls well short of that mark: The record penalty is €1.1 billion in 2009 against Intel for abusing its dominance of the computer chip market.

The commission previously spent years reining in Microsoft, which accrued a total of almost €2 billion in European fines over a decade, including a penalty in 2013 for failing to adhere to an earlier settlement.

Google still could settle the matter. But whatever the search giant might negotiate with the commission, analysts say the deal will have a greater impact on its business than previous attempts to settle. Ms. Vestager’s predecessor, Joaquín Almunia, gave Google three opportunities to make concessions that were aimed at allowing the company to escape both a fine and a formal finding of wrongdoing.

Those settlement efforts repeatedly ran afoul of Google’s rivals, including American companies like Microsoft and Yelp, which successfully complained that most of the changes proposed by Google have been insufficient to solve the antitrust concerns identified by regulators.

“Everyone should have equal treatment,” said Thomas Vinje, a lawyer for FairSearch Europe, which represents rivals to Google. “Google should apply its own algorithm fairly to everything, including its own services.”

Ms. Vestager has come under pressure from the European Parliament to hasten a decision after lawmakers passed a nonbinding resolution last year calling on her to consider breaking up Google.

The antitrust case is among several regulatory headaches that the search engine faces in Europe. Local policy makers have also criticized the company for its tax practices and how it manages people’s online privacy.

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