Internet giant Google was Tuesday found guilty of false and misleading advertising in Australia after a court upheld an appeal by the country's competition regulator.
Google had won a case brought by the Australian Competition and Consumer Commission (ACCC) in September over claims that sponsored links at the top of its search results were misleading to consumers.
But the watchdog appealed in four of the 11 cases and the Federal Court overturned the original decisions.
"In our respectful opinion, the primary judge erred in failing to conclude that Google engaged in misleading and deceptive conduct in the four cases," the court ruled.
It said that adverts using keywords for Honda, Harvey World Travel, Alpha Dog Training and Just 4X4 Magazine were published by Google and led consumers to rival company websites.
Google argued that it should not be "responsible for the content of four particular ads on its platform".
But the court said: "It is Google's technology which creates that which is displayed.
"Google did not merely repeat or pass on a statement by the advertiser: what is displayed in response to the user's search query is not the equivalent of Google saying here is a statement by an advertiser which is passed on for what it is worth."
The court ordered Google, the dominant search engine in the Australian market, to pay the ACCC's costs and implement a compliance programme.
"The ACCC brought this appeal because it raises very important issues as to the role of search engine providers as publishers of paid content in the online age," ACCC chairman Rod Sims said in a statement.
"This is an important outcome because it makes it clear that Google and other search engine providers which use similar technology to Google will be directly accountable for misleading or deceptive paid search results."
The search engine said it was considering its options.
"We are disappointed by the Federal Court's decision that Google should be responsible for the content of four particular ads on its platform," Google said.
"Google AdWords is an ads hosting platform and we believe that advertisers should be responsible for the ads they create on the AdWords platform.
"We are currently reviewing our options in light of the court's decision."
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