Google to comply with EU search demands to avoid more fines

The EU fined Google a record 2.4 billion euros in late June for breaking antitrust rules. Photo / 123RF

Google will comply with Europe's demands to change the way it runs its shopping search service, a rare instance of the internet giant bowing to regulatory pressure to avoid more fines.

The Alphabet unit faced a Tuesday deadline to tell the European Union how it planned to follow an order to stop discriminating against rival shopping search services in the region. A Google spokeswoman said it is sharing that plan with regulators before the deadline expires, but declined to comment further.

The EU fined Google a record $3.7 billion (2.4 billion euros) in late June for breaking antitrust rules by skewing its general search results to unfairly favor its own shopping service over rival sites.

The company had 60 days to propose how it would "stop its illegal content" and 90 days to make changes to how the company displays shopping results when users search for a product. Those changes need to be put in place by Sept. 28 to stave off a risk that the EU could fine the company 5 percent of daily revenue for each day it fails to comply.

"The obligation to comply is fully Google's responsibility," the European Commission said in an emailed statement without elaborating on what the company must do to comply.

The onus is on Google to find a solution that satisfies regulators, who've learned from past battles with Microsoft Corp. and Intel. Corp. Microsoft's failure to obey a 2004 antitrust order and charge reasonable fees for software licenses saw it fined 899 million euros four years later. Microsoft argued that its prices were fair and it shouldn't be compelled to give away patented innovation.

Intel's lawyer said in 2009 that he was "mystified" as to what regulators wanted the company to do to comply with an order to halt anti-competitive rebates for chip sales to computer makers. Intel may finally receive clarity when the EU's top court rules on its legal challenge to a 1.06 billion euro fine on September 6.

Google has the option of challenging the fine and the antitrust order to the EU courts, which can take years to reach a final decision. Next week's Intel ruling will come some eight years after the EU fine. Google would have to comply with the order ahead of any final decision from EU judges.

The EU now has a month to check if Google's planned changes will fit the bill. Regulators are also expected to levy fines in separate investigations into Google's Android mobile-phone software -- possibly as soon as next month -- and the AdSense advertising service. Margrethe Vestager, the EU's antitrust chief, has also threatened further probes on travel or map services.

Regulators sought technical help in June to evaluate how Google complies with the order, setting a budget of up to 10 million euros to pay for experts in search engine optimisation and search engine marketing.

ICOMP, a coalition of technology and media companies, called for Google's offer to be made public and for the EU to publish details of how the company breached antitrust law.

"These affect everyone in the online and mobile worlds so they must be made public for evaluation," ICOMP's Michael Weber said in a blog posting.