Geo-location, determining the location of an internet user based on their ISP's location, is not an exact science. We know it can often be wrong, but yet, many sites that try to personalize the experience for their users based on their location use it. Because more often than not, it is pretty good. It is obviously even better on mobile devices that utilize GPS or cell tower triangularization but for those sitting behind their computers, on their desk - most rely on ISP data.
A WebmasterWorld thread has two senior members from outside of the U.S. complaining that Google can't find them. Here are there posts:
I'm in Lincolnshire in the UK, the second largest county in the entire UK, searching Google.co.uk for something specific HOWEVER Google in all its infinite attempted AI architecture keeps giving me Lincolnshire, Illinois, a village, a suberb of Chicago.
I have searched several times on google.com.au for [niche] [location] where location is also a small town in the US, and gotten US results - where I had 'pages from Australia' checked.
Proof it is not perfect and Google knows this. Google has a form people can use to submit errors in their auto-location. The form is over here and can be used to submit errors in Google auto-detecting the wrong location.
Forum discussion at WebmasterWorld.