Google Has Just ‘Weeks’ to Solve EU Problems or Face $5B Fine
Google (NASDAQ:GOOG) now only has a couple weeks to provide the European Commission with new antitrust concessions after the ones it proposed in September were again denied by both the EU watchdog and a group of Google’s competitors.
According to a report from the Wall Street Journal, Commission head Joaquin Almunia told reporters in Brussels on Wednesday that Google has one last chance to settlement the complaints, or the company will launch a formal investigation into the practices of Google’s search business in the EU. “I’m waiting for this last opportunity to solve this,” Almunia said. “We need more, not during the next year, but during the next weeks. I have not yet received this answer.”
If the Commission moves forward with an investigation, Google could face a fine of up to 10 percent of its global earnings, or $5 billion. Google couldn’t be reached by the Journal for a comment. The European Commission’s probe into Google’s search business began in 2010 upon a complaint from a group of Google’s competitors called Fairsearch, which counts Microsoft (NASDAQ:MSFT) among its members. Google has been accused of favoring its own links over the links of rivals in its search results, copying content from other sites without permission, and overall using its dominance in the market to squash its competitors.
A first round of concessions offered in the spring were denied as not doing enough to stimulate competition. The concessions submitted in April included doing more to distinguish between Google’s own products and the products of rivals in search results, as well as including links to at least three of its competitors with each search query. After those were rejected, Google went back to the drawing board and came up with some new concessions, which it submitted to the Commission in September.
The improvements added in September included making it easier to differentiate between Google’s products and those of its rivals on mobile as well as PCs and giving companies the option to opt out of appearing in Google search results. In October, Almunia said that he approved of the new concessions, but that he would enter talks with Fairsearch before approving them.
Now that the further concessions have been soundly rejected by Google’s competitors, the company has just a short window of time to come up with better ones, or allow the Commission to move forward with an investigation and risk being slapped with that $5 billion fine.
More From Wall St. Cheat Sheet:
- Google Can’t Discriminate: Almunia Lays Down the Law
- New Year, Same Complaints From Google’s European Rivals
- Google Outspends Everyone to Move Into New Tech Territory
Follow Jacqueline on Twitter @Jacqui_WSCS