The case was filed by Copiepresse,a group that represents 18 Belgian newspapers including Le Soir, La Derniére Heure and La Libre Belgique.
The organisation alleged that Google's cache and news services offered free access to its copyrighted materials.
A judge last September ordered Google to remove all the copyrighted materials and threatened the firm with a €1m daily fine if it failed to comply.
Google has since removed all references to the newspaper websites from its services, and vowed to fight the legal ruling.
While upholding the original conviction, the Brussels court drastically cut the legal penalties to €25,000 per day. Publishers now also have to give the firm notice about any copyright violations and allow for these to be removed.
Google said that it was disappointed in the ruling and will continue its appeals.
"It is important to remember that Google Web Search and Google News only ever show a few snippets of text. If people want to read the entire story they have to click through to the web publisher's site where the information resides, " the company wrote on its official blog.
"We believe search engines are of real benefit to publishers because they drive valuable traffic to their websites."
Google pointed out that online publishers can use technical standards like a robts.txt file and metatags to prevent search engines from indexing certain web pages.
"If a newspaper does not want to be part of Google News, we remove their content from our index. All the newspaper has to do is ask. There is no need for legal action and all the associated costs."
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