America's competition regulator has given the green light to Google's $3.1bn (£1.6bn) takeover of online advertising company DoubleClick in spite of opposition from industry rivals who fear that it will give the search firm unfair dominance.

The Federal Trade Commission said: "After carefully reviewing the evidence, we have concluded that Google's proposed acquisition of DoubleClick is unlikely to substantially lessen competition."

The decision was welcomed by Google, though the takeover is far from complete. It is still being scrutinised by the European commission and an outcome is unlikely before April. "The FTC's strong support sends a clear message - this acquisition poses no risk to competition and will benefit consumers," said Google's chief executive, Eric Schmidt.

Microsoft is among the takeover's fiercest critics. It maintains that Google will be able to use a vast store of search data about customers' habits to target advertising. Addressing a senate committee in September, Microsoft's general counsel, Brad Smith, said: "Google is already Amazon and is already Fed Ex and now they are trying to buy the post office."

A telecoms analyst, Scott Cleland, backed the view by telling the senators that the deal was the equivalent of merging the top 15 Wall Street investment banks with the New York and London Stock Exchanges, while throwing in data providers such as Bloomberg, Experian and Equifax.

Google has said that competition clearly exists and points to the fact that Viacom this week abandoned DoubleClick and took a $500m advertising deal to Microsoft's Atlas platform. A Google spokesman said: "Google has argued all along that the online advertising space is highly competitive."