Europe's antitrust chief says Google has one "last opportunity" to settle allegations it is abusing its dominant position in web search before he pursues legal action.

Joaquin Almunia, the head of the European Commission's competition unit, has been pursuing an antitrust complaint against the US search giant since 2010. Google has provided two proposals to settle the complaint, but seen both rejected. It is now believed to be preparing another proposal.

Almunia told reporters on Wednesday: "let's see if Google can improve their proposal or we go the traditional route." That route would involve a formal Statement of Objections which could then see a protracted court case, and potentially fines of up to 10% of Google's global revenues - which would amount to billions of dollars. The EC has previously pursued and won such cases against Microsoft and chipmaker Intel.

"We need more, not during the next year but during the next weeks," Almunia said. Google's next proposal is its "last opportunity" for reaching a negotiated settlement, he said.

Feedback from rivals and complainants to the two proposals from Google had been clearly negative, Almunia added. Google declined on Wednesday evening to comment on Almunia's remarks.

The EC's antitrust unit began investigating Google in 2010 following complaints from a number of smaller companies, which alleged that it was demoting them in search results while displaying similar services of its own prominently on its first search results page.

Google dominates the market for web search in the EC, where it gets more than 90% of searches compared to around 70% in the US. Almunia in October reiterated the areas he sees as "problematic", including its favouring of its own services in web searches (depressing prospects for rivals), the use of original content from third party sites in results (creating a disincentive to create original content), preventing publishers showing ads from rivals on websites using Google ads, and contractual hurdles to exporting search advertising campaigns from Google's platform.

"On each of the four, we believe there is a strong case for action under our antitrust rules," Almunia told the European Parliament in October. A second proposal from Google to remedy the complaints was rejected by Almunia just before Christmas.

In that, the principal concession from Google was to offer competitors the chance to advertise their own services and brand as links in a box of "sponsored" search results, subsidiary to a Google-branded result. But rivals and complainants, including Microsoft, the German company Hot-Maps, Foundem and the Premier League, argued that this did not tackle Google's favouritism for its own products in results, and that they would end up paying Google to appear in a less visible location than Google's products got for free. They cited academic studies that they commissioned which they said backed up their complaints.

Any restrictions that European regulators might place on Google would be valid only in the EU - which has also led some complainants to suggest that Google might try to elude any restrictions placed on it by the EC by routing searches through non-EU data centres. Google has not indicated what it would do.

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