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Competition Law

Analysis - debate - current awareness

28 FEB 2014

Google and the European Commission: The New 'Search' Frontier

At the beginning of February, the European Commission published a memo regarding its Google 'vertical search' investigation. The investigation, in part, relates to the way in which Google displays specialised comparison search results for various products such as flights, hotels or electrical goods. The Commission's main concern is that Google displays its own specialised search results more favourably than competing companies like Foundem or Shopzilla.

The Commission's investigation began in November 2010 and involved six hundred consultation replies, two market tests and subsequent feedback on Google's initial two settlement proposals. More than three years on, a final set of proposals has been published by Google that the Commission believes alleviates its competition concerns. In summary, Google's commitments will ensure that:

1. Google advertises the relevant products of three rival search companies alongside its own vertical search results;

2. Competing search companies can opt out of the way Google uses their content in its own offerings. This is because Google has been accused of using, for example, user reviews from competing websites without prior authorisation; and

3. It removes (a) search advertisement exclusivity provisions in its agreements with websites, and (b) restrictions on porting advertising campaigns away from Google to one of its competitors.

The significance of this Google investigation should not be underestimated. The Commission's approach in many anti-trust instances continues to focus on commitment (and settlement) solutions rather than the more adversarial route of a formal statement of objections and subsequent appeals; the potential advantage being quicker benefits to consumers in a relatively nascent market. From a political perspective, with Vice President Almunia's term drawing to a close, some believe finalising such a high-profile investigation on 'his watch' may go some way to cementing his competition legacy. Most importantly, consumers as a result will see subtle but important changes to the way they search for goods and services on Google with search results from Google's competitors becoming more prominent.

If you would like to discuss these issues, please do not hesitate to contact John Cassels at john.cassels@ffw.com

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