The European Commission has launched an antitrust investigation against Google over allegations that the search giant ranked its own services above those of competitors in its results pages.
"The opening of formal proceedings follows complaints by search service providers about unfavourable treatment of their services in Google's unpaid and sponsored search results, coupled with an alleged preferential placement of Google's own services," the commission said in a statement on Tuesday.
Regulators will "investigate whether Google has abused a dominant market position in online search", it added.
As part of the probe, EU regulators will examine complaints that Google had lowered the 'quality score' for the sponsored links of competing 'vertical search providers'. Such providers let visitors search for specific content, to deliver price comparison tables, for example. The quality score is a factor in determining how much advertisers have to pay the search company.
The antitrust proceedings will also cover allegations that Google "imposes exclusivity obligations on advertising partners, preventing them from placing certain types of competing ads on their websites, as well as on computer and software vendors, with the aim of shutting out competing search tools", the EC said. Regulators will also "investigate suspected restrictions on the portability of online advertising campaign data to competing online advertising platforms", it added.
Although the commission has not been explicit about the source of the complaints, they echo those made in February by Microsoft's Ciao price-comparison service, the UK price-comparison site Foundem, and the French legal search engine Ejustice.fr. All three companies are vertical search providers, and they have alleged that Google demoted their sites in its search results because they are rivals.
Microsoft made it clear in March that it is leading the charge against Google over concerns about the search giant's business practices. A similar antitrust case against Google is underway in the US state of Texas.
In July, competition commissioner Joaquin Almunia noted that it was very difficult to establish dominance on the web, which is an essential prerequisite to any web-related antitrust case. At the time, he hinted that the commission was in the early stages of "examining some allegations of anti-competitive conduct in relation to search".
On Tuesday, Google responded to the EU investigation by saying in a statement that it had always "worked hard to do the right thing by our users and our industry, ensuring that ads are always clearly marked, making it easy for users to take their data with them when they switch services and investing heavily in open-source projects".
"But there's always going to be room for improvement, and so we'll be working with the commission to address any concerns," the company added.
Google said there were "compelling reasons" why some sites that were unhappy with rankings had been ranked poorly by Google's algorithms. It said that Foundem "duplicates 79 percent of its website content from other sites, and we have consistently informed webmasters that our algorithms disadvantage duplicate sites".
A spokeswoman for commissioner Almunia told ZDNet UK that there is no timescale for the investigation.
"The commission will continue its investigation," she said. "It may ask other competitors also to give their views, and in the end there will be a decision. This may take time — antitrust procedures are quite lengthy ones, and we do not submit to any time schedule."
If found guilty, companies that fall foul of EU competition laws can find themselves paying dearly. In May 2009, the EC concluded a massive antitrust investigation against Intel, levying a €1.06bn (£959m) fine against the chipmaker.