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April 16, 2015

E.U. Charges Google With Violating Antitrust Laws

BRUSSELS — The European Union’s antitrust chief on Wednesday formally accused Google of abusing its dominance in web searches to the detriment of competitors and began official proceedings into whether its Android smartphone software forces phone makers to favor the company’s own services and applications.

“If the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe,” said Margrethe Vestager, the European Union competition commissioner.

The abuse charge focused on accusations that Google diverts traffic from its rivals to favor its own products and services, particularly websites for shopping. That led the European Commission to issue a set of formal charges, known as a statement of objections.

A large number of online operators have complained about Google in other areas, like travel and mapping. Ms. Vestager said that the inquiry might eventually expand beyond shopping sites.

In the United States, the Federal Trade Commission investigated similar complaints against Google, but closed that inquiry without taking action in 2013 — despite an agency staff report, which subsequently surfaced, recommending that Google be reined in.

Wednesday’s action in Brussels is not expected to change Washington’s position that Google’s search business does not violate antitrust laws.

The European Commission also said on Wednesday that it was stepping up a separate investigation into whether phone makers that agree to use Android — and that also want Google applications like YouTube — face contractual requirements to place those applications and other Google-branded applications in prominent positions on a mobile device.

“Smartphones, tablets and similar devices play an increasing role in many people’s daily lives,” Ms. Vestager said, “and I want to make sure the markets in this area can flourish without anticompetitive constraints imposed by any company.”

Google’s Android software, which is used by large cellphone makers like Samsung, is the world’s largest operating system with roughly an 81 percent market share, according to the technology research company Gartner.

Apple holds a 15 percent stake, while Microsoft has a less than 3 percent share. Google on Wednesday defended its business practices.

“While Google may be the most-used search engine, people can now find and access information in numerous different ways — and allegations of harm, for consumers and competitors, have proved to be wide off the mark,” Google said in a blog post on Wednesday.

In a separate blog post, the search giant also said that its partnerships with cellphone makers that rely on Google’s Android operating system were voluntary, and that they offered benefits to both consumers and manufacturers.

“The decision by the commission to position itself as the lead competition authority for the digital age may trigger anger among some U.S. politicians, and there is no denying that the U.S. industry has been at the forefront of technology,” said Emanuela Lecchi, a partner in London at the law firm Watson, Farley & Williams.

nytimes.com

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