EU Demands Major Changes to Google’s Search Rankings

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The FINANCIAL — The European Union has demanded sweeping changes to the way Google Inc. ranks rival comparison-shopping services in its general search results and warned that the company could be fined for alleged past violations of EU antitrust law, according to a formal charge sheet that was sent to the U.S. search giant in April, three people familiar with the matter said.

The charge sheet, which runs more than 100 pages, calls on Google to use the “same underlying processes and methods” when presenting rival shopping-comparison services on its search page, the people said, according to Nasdaq.

That demand for equal treatment of competitors goes far beyond Google’s own proposal last year to settle the concerns of the European Commission, the EU’s top antitrust authority, that Google skews search results in favor of its own specialist search services, like Google Shopping.

The EU’s latest approach has potentially far-reaching implications for how search operators do business in Europe in the future.

At issue is whether Google uses its overwhelming 90% share of online searches in Europe to squeeze competitors in related markets where it also competes.

The EU’s new antitrust chief, Margrethe Vestager, filed formal charges against Google in April, escalating her agency’s five-year-old investigation. The charges focused specifically on Google’s comparison-shopping service, but Ms. Vestager said she also continued to examine other domains, such as travel and local services, where Google is accused of favoring its own services.

A redacted version of the charge sheet, which is known as a statement of objections, was sent Thursday to several of the companies that have filed formal complaints in Brussels over Google’s business practices, the people said. News Corp, which owns The Wall Street Journal, is one of the complainants.

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The charge sheet claims that Google’s alleged abuses extend to 12 European countries and date back as far as 2008, the people said. The document warns that the EU could fine Google for the violations, the people said. The European Commission declined to comment.

Comparison-shopping sites such as Nextag say that when users search for products, Google features results from Google Shopping and relegates products featured on rival sites lower, where they may not be seen.

Google has repeatedly denied breaking EU antitrust rules. U.S. regulators closed their own investigation into Google’s search practices two years ago after the company agreed to voluntary changes.

Google couldn’t immediately be reached for comment. The company said in April that it strongly disagreed with the need to issue formal charges, and looked forward “to making our case over the weeks ahead.”

Ms. Vestager’s predecessor, Joaqui n Almunia, sought three times to settle with Google, most recently in February last year. Under the latest deal, Google offered to reserve space near the top of its European search pages for competitors to serve specialized search results for things like hotel rooms alongside Google services that do the same thing.

But each settlement ultimately foundered amid criticism from the companies it was designed to protect.

Several of those companies indicated Friday that they would look more favorably on the EU’s latest solution.

Google has at least a few more weeks to respond to the EU’s charges, and can request an oral hearing with regulators to better present its case. The companies that filed complaints against Google have four weeks to file their own responses to the charge sheet.

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The news of the charge sheet was first reported by MLex, a specialist news service for regulatory affairs.


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