The Dutch Data Protection Authority will then decide whether to take action against Google, which could include a fine.
In June, Spain's Data Protection Agency said it had initiated sanction proceedings against Google, which could face a fine of up to $408,000.
However, fines by data protection authorities are minimal in comparison with Google’s capacity to generate revenues of more than $545,000 every five minutes, according to the Guardian.
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Dutch investigators said it is "almost impossible" for internet users not to interact with Google, but the company does not properly inform users what personal data it collects and combines.
They said Google also does not properly inform users of the purpose of collecting their personal data, and that proper user permission cannot be obtained by accepting general terms of service.
Responding to the findings, Google said it provided users of its services with sufficiently specific information about the way it processed their personal data.
Privacy groups are concerned that personal data is being stored in the US, reducing the control that European citizens have over their personal information.
These concerns have increased in the wake of claims by whistleblower Edward Snowden that US intelligence services have access to material stored in US-based cloud services.