Tue, Nov 25, 2014 - Page 15 News List

EU politicians target splitting Google if antitrust probe fails

Bloomberg

A European Parliament bid for legislation splitting up Google Inc may send a message that is too loud to ignore, as EU antitrust regulators review a possible settlement with the owner of the world’s largest search engine.

Google, already grappling with privacy and competition issues, risks another EU headache as some lawmakers seek to follow a successful attack on bankers’ bonuses with measures to break up the search giant.

CRITICAL CHALLENGE

“This represents a new escalation for Google,” said Greg Sterling, vice president of strategy and insights for the Local Search Association. “There’s some question about whether breaking up Google would actually happen — however it does indicate the depth and intensity of the critical antagonism and challenge that Google confronts.”

While the parliament does not have the authority to compel regulators to draft legislation or alter their antitrust probe, it can amend proposals by the European Commission. Lawmakers used this procedure to shoehorn extra curbs on banker bonuses into legislation toughening capital requirements in the wake of the financial crisis.

The bonus measures prompted outrage from UK Chancellor of the Exchequer George Osborne, who only abandoned his legal fight against the rules last week after an adviser to the EU’s top court said the rules barring bonuses more than twice fixed pay were legal.

Attacking Google may be more difficult for the parliament than the bonus rules, lawyers said. That is because the assembly, which meets in Brussels as well as Strasbourg, France, has fewer powers in the competition field.

Google, which has more than 90 percent of the search market in many European countries, is being targeted by a group of parliamentarians who say the commission should consider legislation if it cannot wrap up a lengthy antitrust probe into the company.

“Unbundling search engines from other commercial services” should be considered, according to a draft resolution for a parliament vote tomorrow that did not specifically mention Google.

The commission’s antitrust investigation into allegations that Google promotes its own services above rivals hits a four-year anniversary later this month. The Brussels-based EU authority has been weighing complaints for at least five years.

‘ANTITRUST POPULISM’

The parliament’s attempt to influence a legal investigation is “antitrust populism,” said Nicolas Petit, a law professor at the University of Liege in Belgium.

Such efforts “have not been going beyond gesticulations and rightly so,” Petit said, adding that the assembly “has little if no powers in this field” as it is only consulted on EU law.

There is no end in sight after the EU delayed plans to settle the case amid criticism from rival firms that Google’s concessions would not solve competition problems.

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