Brussels wants to smash Google over 'illegal' online advertising practices

EU competition chief Margrethe Vestager announced on Wednesday morning that she was «declaring objections» against Google. Photo: JOHN THICE/AFP via Getty Images

The European Union seeks to carve up Google's advertising giant as Brussels escalates its war with the internet giant.

Margrethe Vestager, head of EU competition, on Wednesday morning announced a «statement of objection» against Google, alleging that the company used illegal tactics to dominate the online advertising market and charged advertisers inflated prices.

The European Union said so. expected to order Google to sell part of its advertising business, arguing that this was the only way to ensure that the company would change its policy.

Ms. Vestager has repeatedly fined the company in recent years, with three separate penalties. worth more than 8 billion euros (6.8 billion pounds).

However, this is the first time that Ms Vestager said that the EU expects to split Google. She said it was «a reflection of how ubiquitous Google is in this value chain, and we believe selling assets is the only way to address this.»

Google has said it will resist attempts to break it up and strongly disagrees with the case.

The EU's objections focus on Google's advertising business, which is used by millions of websites and advertisers to advertise.

Google operates the world's largest ad exchange, AdX, which is used to run quick auctions that determine which ads will be shown on third-party websites.

However, the company also has the most popular automated tools for both buying and managing ad spaces.

Ms. Vestager said Google's tools favor their own exchange over competitors, for example by sharing the best «deals» from other exchanges. This gave Google AdX an unfair advantage by allowing it to charge higher fees. «[Google] sets the rules for matching supply and demand,» she said.

Ms Vestager said she is in «constant contact» with both the US Department of Justice and the UK Competition and Markets Authority. An authority on building a case.

Dan Taylor, Google's VP of Global Advertising, said, “Our ad tech tools help websites and apps fund their content and enable businesses of all sizes to effectively reach new customers.

“Google remains committed to delivering value to our publisher and advertiser partners in this highly competitive sector. The Commission's investigation focuses on a narrow aspect of our advertising business and is not new. We do not agree with the views of the EU and will respond accordingly.”

The representative added that the company would oppose demands to sell any parts of its business and that this would be detrimental to advertisers.

The Statement of Objection is a preliminary set of allegations and it could take years for the European Commission to issue a fine and any order, which can then be challenged by the company.