EU Presses Inquiries Into Google Parent Alphabet
April 04 2016 - 06:30PM
Dow Jones News
BRUSSELS—The European Union is "advancing" its investigations
into whether Google parent Alphabet Inc. is abusing its
dominancewith its Adsense advertising service and its Android
mobile-operating system, the bloc's competition chief said in an
interview Monday.
Commissioner Margrethe Vestager's comments, which come ahead of
a trip Wednesday to the U.S., suggested the regulator could bring
more formal charges against the U.S. search giant.
Ms. Vestager filed separate formal charges against Google last
April for allegedly skewing its search results to favor its own
shopping service.
At the time, she also opened a formal probe into Google's
conduct with Android and said she would closely watch its behavior
in other areas, including whether the company prevents or obstructs
website operators from placing ads on their websites that compete
with Google's advertising business.
The European Union has recently sent out questionnaires to
companies requesting more detailed information into Google's
practices in its advertising business, according to several people
familiar with the matter. Two of those people said the
questionnaires sought information that went beyond the issue of
whether Google was forcing website operators to use its advertising
service exclusively.
"Advertising is key…Google bases its business on getting people
into the Google ecosystem, and discouraging them from leaving, so
that they can be exposed to advertising—and that's where the money
is made," said Alec Burnside, a Brussels-based antitrust lawyer
with Cadwalader, Wickersham & Taft LLP, who advises a number of
Google complainants.
On Monday, Ms. Vestager said the EU's separate probe into
Google's conduct with its Android mobile operating system remains a
high priority, but added that said she didn't know when the
investigation would be completed.
She said the commission is looking at "questions about
tying—where if you want the Android system, then it comes with a
Google suite" of apps.
One of the issues the EU raised when it opened the investigation
a year ago was allegations that Google required smartphone and
tablet-computer makers to preinstall a range of its own apps for
messages, search, email and other functions if a manufacturer
wanted to include any one of them.
Google declined to comment. News Corp, publisher of The Wall
Street Journal, has filed a formal complaint with the commission
regarding Google's business practices.
Ms. Vestager said she wants to make sure in coming months she
can start closing some of the many competition cases the EU has
opened in recent years.
One case still open is against Russian energy giant Gazprom PAO.
Ms. Vestager said the commission was still pursuing two possible
tracks in the case: the option of formally ruling against the
company or a potential settlement. "It remains to be seen if a
commitment process can be successful," she said.
Gazprom recently said the two sides were making progress toward
a "mutually acceptable solution."
Last April, the European Commission, the EU's executive arm,
accused Gazprom of violating EU antitrust law in eight central and
Eastern European countries where the Russian company was the
dominant gas supplier. The commission said restrictive terms in
Gazprom contracts forced territorial constraints on customers, for
instance, by prohibiting them from re-exporting gas to another
country.
Ms. Vestager rejected accusations by U.S. officials that she was
discriminating against American companies. The EU has opened
high-profile inquiries into whether tax breaks in member countries,
such as Ireland and Luxembourg, violate rules against excessive
state aid to companies. If deemed illegal, European officials could
require those countries to recover corporate funds related to the
tax breaks.
"What we're doing for every company—be that a U.S. company or a
European company—is to make sure that their competitors don't get
away with paying very, very little in taxes compared with
themselves," the commissioner said.
U.S. companies whose tax practices are under investigation
include Apple Inc. and Amazon.com Inc. Companies outside the U.S.
also have been affected. U.S. Treasury Secretary Jack Lew wrote to
the commission in February accusing the EU of disproportionately
targeting U.S. companies over the tax breaks.
During her trip to the U.S., Ms. Vestager is scheduled to attend
the annual meeting of the American Bar Association in Washington.
While there, she will also meet with Mr. Lew as well as members of
Congress and the U.S. administration, including U.S. trade
representative Michael Froman.
Write to Natalia Drozdiak at natalia.drozdiak@wsj.com
(END) Dow Jones Newswires
April 04, 2016 18:15 ET (22:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
News (NASDAQ:NWSA)
Historical Stock Chart
From Feb 2024 to Mar 2024
News (NASDAQ:NWSA)
Historical Stock Chart
From Mar 2023 to Mar 2024