The European Commission has warned Google that it needs to make stronger concessions in its offer to settle a pending antitrust action that’s based on the way it presents search results.

The European Commission heads the Executive Branch of the European Union. The antitrust investigation stems from Google’s 90 percent search market in the EU. In contrast, Google’s share in the U.S. market is about 70 percent.

The European Commission is concerned that Google is taking advantage of its huge market share to promote its own advertisers and its own services at the expense of others. In May Foundem, a competing search engine company that initially filed an antitrust complaint against Google, presented its report on Google’s proposals to promote greater competition in the search market. The EC sent its response calling on the search giant to improve its proposed remedies to Google Executive Chairman Eric Schmidt on July 17.

The situation with Google’s search manipulation isn’t as obvious to users in the United States as it is to observers in Europe. There, a search request typed into the Google search engine returns results that clearly highlight Google-sponsored content before the results from sites that don’t have a relationship with Google. In fact, as I found when I was using Google for search while in Hannover, Germany, for the CeBIT trade show, non-Google results frequently didn’t show up until the second or third page of results.

Unlike in the United States where sponsored links are clearly delineated, the results in the EU have no such distinction. Sometimes even when you click on a link it’s not clear that it was sponsored by a Google advertiser.

The EC opened its investigation into Google search manipulation in 2010. Earlier this year, Google presented the EC with a proposed settlement that would have included highlighting sponsored links and results from Google advertisers and ensuring that at least three Google competitors’ results showed up on the first page.

The problem that Google’s competitors had with its proposed solution was that Google’s proposed fixes in effect highlighted Google’s products while downplaying the results from competitors. Meanwhile, Google’s competitors proposed their own solution that requires non-discrimination, transparency and non-retaliation.

The U.S.-based consumer advocacy group Consumer Watchdog, wrote to the EC in May outlining some of what it sees as the deficiencies of Google’s proposed solutions to its manipulation of search results.

“Since 2007, if not earlier, Google has favored its own services–particularly its specialized ‘vertical search’ services–over the services of competitors. Google has both promoted its own services in its search results and demoted and penalized the results of its competitors,” John Simpson, privacy project director for Consumer Watchdog, said in a letter to the EC.