Competition Commissioner Margrethe Vestager has no easy job. As the Dane took office last December, it took over an unfinished task. For five years her predecessor Joaquín Almunia had struggled to communicate in a running competition proceedings peacefully with Google.
Several companies had at the European Commission, the dominant Google’s position appears. It is, inter alia, the accusation that Google prefer their own services in the results pages of search engine. Among the complainants addition to the associations of the German newspaper and magazine publishers including the media company Axel Springer (“world”, “image”).
Over the years, negotiated the Spaniard Almunia with Google about a peaceful settlement. Three times did Google concessions, but three times rendered including his colleagues in the resistance Commission. Google, their concern was too powerful and should take further steps. At the end had Almunia empty-handed from the Office divorce.
Now, the European Commission will accuse Google officially unfair competition, according to the matching media reports. Vestager will announce the escalation of the current years process this Wednesday, reported “Financial Times”, “Wall Street Journal” and “New York Times”, citing informed people.
The case has explosive force. And so Vestager Commissioner announced shortly after taking office on to address the issue. You’ll see the new method, Vestager said right at the beginning of their term of office. And they also asked for “some time” to reconsider the case.
Google needs to ten percent of the annual turnover fear
Already since 2010, the Commission shall consider whether Google’s position as a leading search engine, which processes nine out of ten queries, exploiting. Legal basis of Article 102 of the Treaty on the Functioning of the European Union (EUAV). “Prohibited as incompatible with the internal market, the abuse of a dominant position within the internal market” is written in it.
The Commission, as guardian of the free internal market has several options to react to the suspicion of such a dominant position of the company. You may, under Article 9 of the corresponding Regulation try to find a peaceful settlement. However, it can initiate proceedings under Article 7 also – at the end might be restrictions and penalties
The stakes are high for Google.. Up to ten percent of annual sales, the Commission may designate as punishment. In Google’s case that would be up to 6.6 billion euros. That would be for the financially strong group from Mountain View, the cash reserves of over $ 60 billion calls his own, a lot of money.
Heavy but could editions weigh that could provide the Commission Google. “The Commission may require changes to the business model of Google, for example, that a certain number of competitors in the search engine shows up at the top,” says Bert van Roosebeke, an expert at the Center for European Policy in Freiburg.
EU Parliament calls for destruction of the giants
If such behavioral changes are not purposeful, Google is threatening even the destruction. “In the extreme case, the Commission of Google could also structural changes require,” says Roosebeke, “ie the ownership separation of the engine from other divisions demand.”
There would be exactly what the European Parliament requires. The parliament had adopted in mid-November of last year on the party boundaries a statement in which the splitting of Google is required. The search engine Google should be separated from the services, such as Google Maps.
From the demand parliamentarians have since no retreat. “The Commission should not only punish breaches of competition law, but also to ensure the neutrality of search engines so it does not even come to distortions of competition,” says the Green MEP Jan Philipp Albrecht against the “world.”
The expert for IT policy expected that the Commission will now soon come to a decision. “Ms. Vestager has clarified immediately after taking office that they would like to make a new start in the Google method,” says Albrecht. “Now the time has arrived to put results on the table.”
action can also be the great salvation for Google
He urged the Commissioner to hurry. “Google distorted competition,” says Albrecht. “Every day that Google can continue with it, is a day on which the company continues to expand its dominant position.”
When Vestager presents its decision , is completely up to you. The Commission colleagues as possibly an informal voice. So if she keeps under Articles 9 and a peaceful settlement with Google searches or Article 7 bringing a claim that’s their decision.
In the latter case would the Commission google submit an application, called a Statement of Objection. The document that hundreds of sites are usually heavy, summarizes, in principle, all the objections and facts together, who shared the complainant and the European Commission.
There is a critical moment for the Commission. Then they will also have to show what she has against Google in the hand. “The Statement of Objection can also strengthen the bargaining power of the accused,” says Mario Mariniello, expert of the Brussels-based think tank Bruegel and former staff of the Commission. “For then he sees clear whether the Commission has a strong case or not.”
accusation of political prosecution
This first part of the process is quick. Google had time to defend themselves in writing and at a hearing against the allegations. Already in a year, experts say, could be a decision falling. Agree would in this case the Commission as a whole. The Competition Commissioner has not only the shots.
One can assume that Google would not give beaten in the event of conviction itself, but European before the Court pulls. As long breath of all stakeholders is needed. Such a process can take years and cost a lot of money and effort all pages.
Google would not go to such a method with empty hands. The Internet company can point out that he had agreed last year at least with Ex Competition Commissioner Joaquin Almunia on a solution. Almunia had represented against the complainants in a “pre-Rejection Letter”, a formal letter in the procedure, in which he explained why the complaint against Google did not lead to a formal process.
If Vestager now but to open a formal procedure, Google could give this letter to explain that now held more political than competitive considerations to an indictment. “It helps Google that Commissioner Almunia last year, the complainants explained why he wanted to agree with Google,” says Bruegel expert Mariniello.
Should Google advertise the competition?
The Compromise of Almunia was not accepted, not the complainants and not in the circle of the Commission. Google would therefore need to adjust the display of its search results, and about when shopping Find or Search for services or local shops and restaurants on equal footing with their own services, for example from Google Local, must also display results from competitors like Yelp.
But Google would have to give up to fifty percent of the valuable screen space on the results page, which is otherwise filled with either promotional links or references to its own vertical offers. Also in the mobile segment, the Group
would have to expand its Search according to offerings from the competition. It would Vestager now open to look for a new compromise with Google. However, it is questionable whether the consolidated or they will go beyond the former offer. In an internal analysis of the Bundeskartellamt the competition experts had indicated last year that European competition law, Google can not force them to actively promote competition.
Speculation Vestager on concessions from Google ?
A complete splitting of the group in the search engine on the one hand, and services like Maps, Local, or Google Mail on the other hand, the European Union directly is difficult or impossible to enforce in a US company.
The competition authorities could require more than a kind of virtual separation of services for the EU. The question is whether Google can implement that and wishes, or the Group in doubt, do not simply withdraw certain services in the EU. In a dispute with Spanish publishers about Google had the Google News service in Spain since stopped.
On Wednesday Vestager will travel to the meeting in Brussels in the USA and hold various lectures. The opportunity they should use them to clarify their position in the homeland of Google.
Even Microsoft had to the EU Commission bow
potential threat, the feisty Dane. You could expand its investigation and take about Google’s dominance in the mobile operating systems under the microscope. There, the EU could – require the integration of external services in Google’s Android system
possible solution would be that Google when you first start – similar to the agreement with Microsoft. an Android mobile device could ask the user whether he prefers to use the competitive search, maps and e-mail accounts from Microsoft, Web.de, Nokia and other providers Google search and Google map and mail services or.
Such an agreement would be for Google a blow – currently available in Germany more than 80 percent of all new appliances Google’s Android, the dominance in the mobile market ensures Google’s market position in of mobile search.
The decision to Digital Commissioner Günther Oettinger said in the “world” lay with his colleague. Margrethe Vestager would “decide what steps they go” would, he said. “But I think,” he added, “that they will be far-reaching.”
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