The partnership between the world’s most popular Internet giants might not happen after all as Google does not agree with all the government restrictions due to the antitrust law.

According to the Wall Street Journal, the officials from the two companies, who have met with regulators, appeared to be unwilling to make the compromises needed to satisfy Justice Department concerns that their combined power would overwhelm the online advertising market.

The deal was announced in June and proposed that Google start selling its search ads throughout Yahoo's US properties. However, the partnership was postponed on a regular basis due to government regulation and worries that it would end in a total monopoly of the two companies over the internet search engine market.

The antitrust law is mainly composed of three elements, designed to fight monopoly and encourage competition. The law prohibits agreements that restrict free trading and competition, banns abusive behavior of one company that may dominate the market completely and supervising the mergers and acquisitions of very large companies.

Keeping in mind that Google and Yahoo are currently number 1 and 2 in the Internet search market, some might not see the government’s implication as being obstructive or absurd. Yahoo is estimated to have gained over the partnership a profit of $250 million in the first year alone, and the extended advertising of Google, currently the most popular search engine, would have translated in even more users using the service on a regular basis.

The partnership was not only criticized by the government but also advertisers expressed their worries that the deal would make business much more expensive, as prices for advertisements could go up. Though Google or Yahoo couldn’t be reached for comment, some say that if the deal falls it will be announced as early as Friday.

The demise of the plan would represent another tough blow for Yahoo, which had hoped that the tie-up with Google would help it boost revenues after it rejected a 47.5-billion-dollar takeover bid from Microsoft. A collapse of the planned venture between the two biggest online advertising companies would deprive Yahoo of as much as 450 million dollars in operating cash flow over a year, according to estimates.