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Ad giant Google makes new 'abuse' case offer to EU antitrust cops

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Google appeared to confess today that it had given up fighting the European Commission and its rivals in the search business over claims that it stifled the market by abusing its dominant position.

In a surprise statement from the ad giant, the company appeared to be willing to go much further than it had originally suggested to put an end to a three-year-long battle with antitrust regulators in the EU.

"This has been a very long and very thorough investigation. Given the feedback the European Commission received on our first proposal, they have insisted on further, significant changes to the way we display search results," said Google general counsel Kent Walker.

"While competition online is thriving, we’ve made the difficult decision to agree to their requirements in the interests of reaching a settlement."

Earlier today, Brussels' competition boss Joaquin Almunia went into some detail about Google's revised offer, which he said had "more appropriately" addressed his concerns about the company's alleged abuse of dominance in the search market.

The commissioner, who leaves his post next year, is keen to secure a robust settlement deal with Google that – he has said – will restore competition quickly.

What's interesting is that Google has now indicated that it no longer wishes to fight the EC and its rivals in the case over the abuse claims.

A swift exit from a lengthy battle with the 28-bloc state might actually satisfy Google for a different reason, however. Almunia has already made it clear that, despite requests from the complainants in the case that include Microsoft and Foundem, he will not be proceeding with a second market test that would allow Google's rivals to closely scrutinise the new proposals it has tabled with the commission.

Almunia said today that he was already aware of "the general positions of the complainants and other stakeholders". And, while he does plan to seek feedback from those companies, no formal market test of Google's revised package of concessions will take place this time.

It is now left to competition officials to decide if Google's final offer to fix the way it does business in Europe will be technically feasible in releasing its perceived stranglehold on the search market.

An agreement could be reached as early as next spring.

Lobby outfit FairSearch, whose members include Microsoft, Foundem, Tripadvisor, Oracle and Expedia, said that Google needed to act fairly to restore competition in the search market.

"Until we have seen the details of Google’s proposed remedies, it would be irresponsible to comment on their content and potential for correcting the anti-competitive behaviour identified by the European Commission in May 2012," said the group's legal counsel Thomas Vinje.

"However, for FairSearch Europe it is essential that the remedies install the principle of non-discrimination so that Google applies the same rules to its own services as it does to others when it returns and displays search results."

Google isn't completely safeguarded, of course, from the commission ruling that a formal decision to place sanctions on the ad giant should be applied if Almunia and his officials fail to be satisfied with the company's offer. A Statement of Objections could still be issued that could lead to Google facing a fine of up to 10 per cent of its annual worldwide turnover.

But, after today's comments from the commissioner and especially Google, the case now seems to have edged significantly closer to a settlement deal that could yet leave some parties feeling frozen out of the negotiations. ®

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