UPDATE 2-Google, EU in antitrust resolution talks-source

Mon Feb 7, 2011 1:36pm EST

* Source: tentative talks to resolve antitrust probe

* No concrete proposals on table

* EU Commission says still waiting for market views

* EU seeking views on Google behaviour by Feb. 11

* EU Commission can fine firms up to 10 percent of sales (Adds more EU Commission comment)

By Foo Yun Chee

BRUSSELS, Feb 7 (Reuters) - Google (GOOG.O) and European Union regulators are in tentative talks to resolve an antitrust probe against the Internet's dominant search engine, a source familiar with the case said on Monday.

A deal could avert a lengthy battle and possible fine for the U.S.-based company.

The European Commission opened an investigation into Google last November after three complainants accused it of abusing its position by demoting rival sites in search results and giving preference to its own services.

"There is some interest from both sides, some tentative discussions in resolving the issue, but no really concrete proposals on the table," the source told Reuters.

A Commission spokeswoman said the EU executive was not in discussions with Google at the moment and was still reviewing the case.

"As is known, the Commission is conducting an in-depth market investigation and is still awaiting replies. We will not prejudge the outcome of the market investigation and of this case," spokeswoman Amelia Torres said.

A Commission decision on the case could take months.

Since opening its investigation, the EU antitrust watchdog has sent questionnaires to advertisers, publishers, website owners and rival search engines, asking for their views on Google's business practices by Feb. 11.

The Commission is expected to take several months to digest the feedback. Google on Monday reiterated that it was co-operating with the regulator.

"There's always going to be room for improvement, so we'll be working with the Commission to address any concerns," spokesman Al Verney said.

Google Chief Executive Eric Schmidt told Britain's Sunday Telegraph in an interview that the company was keen to avoid a lengthy legal battle.

The Commission, which can fine companies up to 10 percent of their global turnover for breaching EU rules, has imposed billion-euro penalties on Microsoft (MSFT.O) and Intel (INTC.O) in the past year for anti-competitive behaviour. (Editing by David Brunnstrom and David Cowell)