A settlement may be in the works between Google and the Federal Trade Commission. Google chairman Eric Schmidt is said to be negotiating a deal that would end nearly two years of investigation by the FTC into the company’s alleged monopoly.

Larry Page, Google’s Chief Executive Officer, is trying to persuade the FTC that any agreement the company makes with the agency should not be bound by a consent decree. Google is seeking an informal “handshake” deal, not a formal agreement that could hurt its business prospects, familiar sources told Bloomberg.

Google, the operator of the world’s most popular search engine, has been in talks with FTC Chairman Jon Leibowitz for the last week. The probe into monopolistic behavior by the company and subsequent negotiations have not addressed the most serious charge: that Google intentionally manipulates search results to hurt competitors. The FTC is instead focusing on patent issues and how the search engine displays comments from other internet services. According to The Washington Post, it is possible for allegations of search bias reemerge if negotiations collapse.

Google’s competitors, seeking to curtail the company’s growing power in the digital economy, have called on the FTC to be more heavy-handed with the Mountain View California-based company. Many were seeking a high-profile inquiry reminiscent of the Microsoft monopoly proceedings of the 1990’s. Some have predicted that Congress would address the issue if a settlement were proposed that did not include search.

FTC spokesman Peter Kaplan has declined to comment on the negotiations.