COMPETITION BUREAU FINDS GOOGLE DIDN’T ABUSE DOMINANT POSITION ON SEARCH.
An investigation by Canada’s Competition Bureau has concluded that Google did not use its dominant market position to muscle competitors out of the online search space.
The investigation, launched in 2013, did find that Google once used anti‑competitive clauses in contracts for its online AdWords advertising software. But since Google changed its contracts in 2013 to remove those clauses, and since Google has agreed not to reintroduce those contract terms in Canadian agreements for five years, the regulator will not bring legal action against the Internet company over the AdWords matter.
“We will continue to monitor firms in the digital economy to ensure they do not engage in anti- competitive conduct. Should new evidence come to light of anticompetitive conduct that may affect the Canadian marketplace, by Google or any other market participant, I won’t hesitate to take appropriate action,” said John Pecman, Canada’s Commissioner of Competition.
The Competition Bureau launched its inquiry into Google, now a unit of holding company Alphabet Inc., in 2013. At issue was whether the company’s search and advertising practices ran afoul of the “abuse of dominance” provisions in Canada’s Competition Act. The bureau said it consulted industry and economic experts and conducted more than 130 interviews.
The bureau found no adequate evidence Google engaged in anti- competitive conduct, apart from the bureau’s concerns over the AdWords program. Google’s commitment to change its AdWord terms and conditions resolves that, the bureau said.
“We’re pleased that the Canadian Competition Bureau has decided to end its inquiry,” said Kent Walker, senior vice-president and general counsel of Google Inc. and Alphabet Inc. “We work hard in a competitive landscape to create a great experience for our users and help them quickly and easily find what they need from Google.”
Among the issues under examination was whether Google manipulates search results to exclude competitors who offer rival services, such as maps, travel information, or consumer reviews. The bureau said it did not find adequate evidence that this is the case.
The bureau also looked at whether Google’s agreements with hardware manufacturers and other software developers unfairly steer users to the company’s own popular search engine, and away from other products offered by competitors. The Canadian regulator was satisfied that Google’s software allows users to switch their devices to work on the search engine of their choice.
“Consumers can and do change the default search engine on their desktop and mobile devices if they prefer a different one to the pre‑loaded default,” the bureau concluded. “Google’s distribution agreements have not resulted in a substantial lessening or prevention of competition in Canada.”
Google’s business practices have attracted the attention of antitrust regulators around the world. Indeed, Canada’s Competition Bureau said it worked with the U.S. FTC and European Commission during the Google investigation.
In January 2013, the company agreed to make some changes to its AdWord advertising contracts after a 19- month investigation by the U. S. Federal Trade Commission. Regulators in the European Union are also looking into Google’s business.
As part of the investigation, the Competition Bureau in December 2013 obtained a “section 11” order from the Federal Court of Canada that required Google to hand over information about its search and advertising business. A computer search reveals that no documents have been added to that court file since the December 2013 order.
“There is inadequate evidence to support a conclusion that Google’s conduct, outside its practices related to the AdWords API terms and conditions, was engaged in for an anti‑competitive purpose and/or that the conduct substantially lessened or prevented competition in Canada,” the bureau said Tuesday.