France's antitrust watchdog slapped a 500 million euro ($593 million) fine on Alphabet's Google on Tuesday for failing to comply with the regulator's orders on how to conduct talks with the country's news publishers in a row over copyright.
The fine comes amid increasing international pressure on online platforms such as Google and Facebook to share more revenue with news outlets.
The U.S. tech group must now come up with proposals within the next two months on how it would compensate news agencies and other publishers for the use of their news. If it does not do that, the company would face additional fines of up to 900,000 euros per day.
Google said it was very disappointed with the decision but would comply.
"Our objective remains the same: we want to turn the page with a definitive agreement. We will take the French Competition Authority's feedback into consideration and adapt our offers," the U.S. tech giant said.
A Google spokesperson added: "We have acted in good faith throughout the entire process. The fine ignores our efforts to reach an agreement, and the reality of how news works on our platforms."
News publishers APIG, SEPM and AFP accuse the tech company of having failed to hold talks in good faith with them to find common ground for the remuneration of news content online, under a recent European Union directive that creates so-called "neighbouring rights".
The case itself focused on whether Google breached temporary orders issued by the antitrust authority, which demanded such talks take place within three months with any news publishers that ask for them.
"When the authority decrees an obligation for a company, it must comply scrupulously, both in the spirit and letter (of the decision). Here, this was unfortunately not the case," the antitrust body's chief, Isabelle de Silva, said in a statement. She also said the regulator considered that Google had not acted in good faith in its negotiations with the publishers.
APIG, which represents most major French print news publishers including Le Figaro and Le Monde, remains one of the plaintiffs, even though it signed a framework agreement with Google earlier this year, sources have told Reuters. This framework deal has been put on hold pending the antitrust decision, the sources said.
The framework agreement, which many other French media outlets criticised, was one of the highest-profile deals under Google's "News Showcase" programme to provide compensation for news snippets used in search results, and the first of its kind in Europe.
Google agreed to pay $76 million over three years to a group of 121 French news publishers to end the copyright row, documents seen by Reuters showed.
It followed months of bargaining between Google, French publishers and news agencies over how to apply the revamped EU copyright rules, which allow publishers to demand a fee from online platforms showing extracts of their news.
(Reporting by Christian Lowe, additional reporting by Supantha MukherjeeWriting by Mathieu Rosemain and Ingrid Melander; editing by John Irish, Keith Weir and Jane Merriman)
