EU watchdogs to investigate Google-Yahoo agreement

The European Competition Commissioner has launched a probe into the proposed Google-Yahoo advertising agreement over anti-trust concerns.

The proposed joint venture between search engine giants Google and Yahoo will be investigated by European Union watchdogs.

The European Competition Commissioner, Neelie Kroes, will lead the investigation, and will determine whether the proposal will decrease competition in the search engine market.

Under the terms of the proposed arrangement the Yahoo! search page will be equipped with Google's adwords service.

The agreement would initially be confined to the US and Canada, with European Web surfers remaining unaffected.

But some groups, such as the World Association of Newspapers, have expressed concern that the arrangement would reduce Yahoo's ability to compete against Google in the future.

And a similar probe is being conducted by the US Justice Department, to determine if the arrangement violates US antitrust law.

Google and Yahoo together corner 80 percent of the search engine market. Both companies have pledged to co-operate with the investigation.

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