Australian watchdog to only target Google parent

By Michael Perry

SYDNEY (Reuters) - Australia's competition regulator agreed on Wednesday to only target parent firm Google Inc, and not its Australian and Irish arms, in court action over alleged sponsored advertising links it says are misleading.

The Australian Competition and Consumer Commission (ACCC) said it had told a Federal Court in Sydney it would amend its action after Google Inc confirmed any judgment against it would apply to its subsidiaries.

"Google Inc has told us it is responsible for everything," said ACCC spokeswoman Lin Enright.

"So we agreed with Google Inc that if there were any injunctions or declarations made against Google Inc they would have to put them into effect in Australia," Enright said.

"So there was no need to include these subsidiary companies on the statement of claim. The case is still very much alive," she said.

The watchdog says Google has not done enough to distinguish between sponsored advertising links and the search links that result when customers type keywords into Google's web search system, which it asserts are deceptive.

The ACCC case centers on auto dealer Trading Post Australia Pty Ltd. The commission alleges misleading and deceptive conduct by Trading Post and Google stemming from advertising that appeared on Google's Web site in 2005.

The complaint charges that Trading Post contravened sections of the Trade Practices Act of 1974 when it inserted competitor names on its Google-sponsored advertisements, which directed online searchers for those competitors to the Trading Post site.