The European Union has launched an anti-trust investigation into Google, following allegations from three companies that the search giant was hurting their businesses with "penalty filters" applied to specific sites.

The companies in question are Foundem (price comparison), Ciao (online shopping) and (solicitor services). Google has a 90% share of the search market in Britain, and low ranking in web searches can seriously hurt a site's viability. Foundem said that in December, when Google altered its algorithms, it suddenly received 10,000% more traffic overnight.

Google refuted the accusations in a blog post, saying: "we are confident that our business operates in the interests of users and partners, as well as in line with European competition law", as well as casting doubt on the motives of the companies involved - associating two of them directly with competitor Microsoft.

Google added: "Our algorithms aim to rank first what people are most likely to find useful and we have nothing against vertical search sites -- indeed many vertical search engines like, Opodo and Expedia typically rank high in Google's results", and linked to a blog post from Econsultancy detailing the reasons for Foundem's problems.

"We’ve always worked hard to ensure that our success is earned the right way, through technological innovation and great products, rather than by locking in our users or advertisers or creating artificial barriers to entry", said Google. Whether Brussels will agree or not, however, remains to be seen. We'll keep you posted.