Competitors hope for constructive negotiations with Google
By Sophie Mosca and Brian Beary | Thursday 24 May 2012
By publicly suggesting an amicable settlement with Google over the four points identified as incompatible with EU competition law (see
Europolitics 4426), the European Commission took more than one observer by surprise, given the extremely unconventional nature of this practice. While this choice generally meets with approval, Google’s competitors are far from certain that the Mountain View firm will play the game. Furthermore, this approach “puts pressure” on the American authorities who are also examining the case.
Instead of sending a classic statement of objections - the usual procedure when the EU executive suspects a company of infringing EU competition laws - Competition Commissioner Joaquin Almunia preferred to make public the deal it has offered Google in a simple letter: either the parties can work out a compromise on the disputed points under which the firm will change certain of its practices or the Commission will pursue the conventional procedure. While such proposals by the Commission are not infrequent, they are at least confidential.
At least partly behind this choice is the precedent of the Microsoft case, which lasted nearly ten years, because the goal for all the parties is to avoid a long and very costly legal procedure. Also coming into play is the specific nature of the new technologies sector, which evolves extremely fast, much faster than the legal procedures would take, the risk being that the solutions obtained at the end of the procedure may be obsolete given the technological advances that will have been made in the meantime. Google has also expressed the will to negotiate with the Commission. The firm maintains this position in its statement of 21 May, noting that it disagrees with the Commission’s conclusions, but is “happy to discuss any concerns they [the Commission] might have”.
The Commission’s transparent approach pleases stakeholders on the whole. Kate Sutton, director of
Streetmap.co.uk, said she is “totally unconvinced that Google will voluntarily propose remedies for the injury it has caused to my company”. Several competitors note that Google has nothing to win from engaging in a test of strength with the EU executive. For Gary Reback, a lawyer who represents several Google rivals, Google “will have to decide whether the Commission is well armed with a solid legal case or bluffing its way to winning early concessions”.
Thomas Vinje, lawyer for the FairSearch coalition of competitors, whose members include Microsoft, told
PRESSURE ON UNITED STATES
Commissioner Almunia’s public statements on the case have put pressure on US anti-trust authorities in their parallel investigation. Two US Senators, Herb Kohl (Democrat, Wisconsin) and Mike Lee (Republican, Utah), on 22 May, praised Almunia’s move and urged the US Federal Trade Commission (FTC) to step up its probe launched in 2011. The FTC is trying to determine if Google has caused harm to the consumers by “unfair or deceptive acts or practices in commerce”. An FTC spokesman told
Europoliticsthat it was not disclosing who has complained against Google, what the nature of the complaints were, nor what the FTC’s timeline is for its investigation. The agency has three options: file a lawsuit in a federal district or administrative court (ie sue Google); close the investigation without action; or reach a settlement with Google. Speculation mounted that the FTC was considering a lawsuit when in April it appointed renowned lawyer Beth Wilkinson to lead the case.