Google's Irish unit faces antitrust challenge

Google's unit in the Republic is facing an antitrust challenge in the Australian courts over alleged "misleading and deceptive conduct".

The case relates to sponsored links on the firm's search engine website.

The proceedings were initiated by the Australian Competition and Consumer Protection Commission (ACCC) against Google Ireland, Google Australia and their parent Google Inc over alleged breaches of trade protection legislation. The commission is also taking action against a company called Trading Post Australia.

Google Australia said the claims were without merit. "They represent an attack on all search engines and the Australian businesses, large and small, who use them to connect with customers throughout the world," it said.

The group's spokesman in Dublin said: "As with any similar filings, Google will study the submission and decide how to respond in the coming weeks."

The Australian commission said its case was the first action of its type globally. It alleges that Trading Post contravened the Trade Practices Act in 2005 when the business names "Kloster Ford" and "Charlestown Toyota" appeared in the title of Google links to its website.

"Kloster Ford and Charlestown Toyota are Newcastle car dealerships who compete against Trading Post in automotive sales. The ACCC is also alleging that Google, by causing the Kloster Ford and Charlestown Toyota links to be published on its website, engaged in misleading and deceptive conduct."

"Further, the ACCC is alleging that Google, by failing to adequately distinguish sponsored links from 'organic' search results, has engaged and continues to engage in misleading and deceptive conduct in breach of section 52 of the Act."

The commission is seeking injunctions restraining Google from publishing sponsored links of advertisers representing an association, sponsorship or affiliation where one does not exist and injunctions restraining Google from publishing search results that do not expressly distinguish advertisements from organic search results.

Google Ireland had a turnover of $603.27 million (€437.6 million), pretax profits of $5.25 million in 2004, the last year for which accounts are available.