hankyoreh

South Korea's corporate watchdog said Monday it has ordered Google Inc., the world's largest Internet search engine, to revise or delete unfair clauses in its advertisement contracts with Web site operators.

The Fair Trade Commission (FTC) recently ordered the American company to change several clauses in its AdSense contract, allowing Google to "one-sidedly cancel advertisement deals," while it is written so that it doesn't guarantee returns to contracted Web site operators.

AdSense is an ad serving program run by Google that Web site owners can enroll in to enable text, image and video advertisements on their sites. Google divides the revenue with the Web site operators, based on either a per-click or per-thousand-impression basis.

The FTC highlighted several clauses in the AdSense contract that violate domestic fair trade laws, one of which one allowing Google to "reserve the right to refuse participation to any...participant at any time in its sole discretion."

It also pointed toward an clause that said "Google makes no guarantee regarding...the amount of any payment to be made."

Concerning revenue division, the FTC noted the disadvantage toward Web site operators, as one clause stipulates that "no other measurements or statistics of any kind shall be accepted by Google," when calculating payments.

The commission also raised jurisdictional concerns of the contract, which states that any dispute arising from the agreement "shall be adjudicated in Santa Clara County, California."

Google, through its South Korean office, has expressed its intent to revise the noted clauses, the FTC said.

The corrective order comes amid the FTC's imminent fair trade investigation of domestic Internet portal operators scheduled to begin next month.

"(We) will also focus on the matter of unfair contracts in the upcoming investigations into domestic Internet portal operators," said Yoon Jung-hye, the director of FTC's Consumer Policy Bureau.

South Korea's online ad market is expanding at a fast rate, with sales forecasted to expand up to 1 trillion won (US$1.06 billion) this year from 849 million won last year, according to recent market reports. Approximately half of all sales stem from advertisements from search engines.

South Korea is one of the most wired countries in the world, with about 33 million Internet users, including more than 12 million with broadband connections, government data showed. The nation has a population of 48.5 million.

Seoul, Feb. 26 (Yonhap News)