A tentative settlement has been reached in the three-year antitrust investigation by the European Commission into Google's search technology.
Further concessions have been made by the search giant to meet the demands set by the EC and avoid a potential fine of up to $5 billion (£3 billion), equivalent to 10 per cent of the company's 2012 revenue.
"I believe that the new proposal obtained from Google after long and difficult talks can now address the Commission's concerns," Joaquin Almunia, head of the EC's antitrust unit, said in a statement.
The case dates back to 2010, when Google was accused by smaller companies of favouring its own services in search engine results.
As the most dominant search engine in Europe with over 90 per cent of all search traffic, Google had been able to demote search results of companies that were in direct competition with it.
An ultimatum given by Almunia in January offered Google a "last opportunity" to address the accusations brought against them.
"We will be making significant changes to the way Google operates in Europe," said Google Senior Vice President and General Counsel Kent Walker.
"We have been working with the European Commission to address issues they raised and look forward to resolving this matter."
Feedback from the complainants will be sought by the commission before any settlement is finalised.
Among the proposed changes, Google will allow rivals to display their logos and links in a prominent box on the search pages.
Restrictions on switching advertising campaigns to rival search engines like Yahoo and Bing have also been scrapped.