Today, a European Court confirmed that Google has not infringed trade mark law by allowing advertisers to bid for keywords corresponding to their competitors' trade marks.

The question before the court was whether advertisers should be allowed to choose keywords freely when reaching out to users on the Internet. In other words, if advertisers are allowed to show advertisements when another company's brand name is entered as a search query.

The Court of Justice of the European Union said on Tuesday advertisers were free to buy keywords identical to trademarks of rivals as long as consumers were not confused on the provenance of goods and services by the way ads were displayed online.

The court also confirmed that European law that protects internet hosting services applies to Google?s AdWords advertising system.

"We believe that user interest is best served by maximizing the choice of keywords, ensuring relevant and informative advertising for a wide variety of different contexts. For instance, if a user is searching for information about a particular car, he or she will want more than just that car's website. They might be looking for different dealers that sell that car, second hand cars, reviews about the car or looking for information about other cars in the same category," Google said at the company's blog.

"Our guiding principle has always been that advertising should benefit users, and our aim is to ensure that ads are relevant and useful. We will study the decision as we move forward in order to make sure that we continue to deliver advertising that is perceived as both valuable and relevant by our users," Google added.