November 30, 2010
The Globe and Mail reported earlier today that the European Union has launched an abuse of dominance investigation against Google.
According to the Globe, the focus of the Commission’s inquiry is on conduct by Google that allegedly lowers links to smaller rivals in Google search results. The complainants in the case also claim that when Google offers competing services it places its own links higher on sponsored search results than competing firms. As such, the complaints focus on the two types of online search results: “organic” search results and “sponsored links”.
The complainants in the case include French legal search engine ejustice.fr and Microsoft owned shopping site Ciao.
According to media reports, the Commission has also notified the U.S. Department of Justice of its investigation.
According to the Globe, Google has been quoted as saying:
“Since we started Google we have worked hard to do the right thing by our users and our industry — ensuring that ads are always clearly marked, making it easy for users and advertisers to take their data with them when they switch services, and investing heavily in open source projects. … But there’s always going to be room for improvement, and so we’ll be working with the Commission to address any concerns.”
In the Commission’s Press Release it stated:
“The European Commission has decided to open an antitrust investigation into allegations that Google Inc. has abused a dominant position in online search, in violation of European Union rules (Article 102 TFEU). The opening of formal proceedings follows complaints by search service providers about unfavourable treatment of their services in Google’s unpaid and sponsored search results coupled with an alleged preferential placement of Google’s own services. This initiation of proceedings does not imply that the Commission has proof of any infringements. It only signifies that the Commission will conduct an in-depth investigation of the case as a matter of priority.”
According to the Commission, the substance of its inquiry is whether Google has abused a dominant position in online search to shut out competing services, including allegations that Google lowered the “Quality Score” for sponsored links of competing vertical search engines (which is one of the factors that determine the price paid to Google by advertisers) and that Google imposes exclusivity obligations on advertising partners, preventing them from placing certain types of competing ads on their web sites, with the intention of shutting out competing search engines.
____________________
SERVICES AND CONTACT
I am a Toronto competition and advertising lawyer offering business and individual clients efficient and strategic advice in relation to competition/antitrust, advertising, Internet and new media law and contest law. I also offer competition and regulatory law compliance, education and policy services to companies, trade and professional associations and government agencies.
My experience includes advising clients in Toronto, Canada and the US on the application of Canadian competition and regulatory laws and I have worked on hundreds of domestic and cross-border competition, advertising and marketing, promotional contest (sweepstakes), conspiracy (cartel), abuse of dominance, compliance, refusal to deal, pricing and distribution, Investment Canada Act and merger matters. For more information about my competition and advertising law services see: competition law services.
To contact me about a potential legal matter, see: contact
For more regulatory law updates follow me on Twitter: @CanadaAttorney
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
