EU slams Google with $2.7 billion fine for abusing antitrust law

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EU and Google

Credit: http://www.ibtimes.co.uk/european-commission-could-charge-google-over-android-app-bundling-1555426

The European Commission in charge of competition has fined Google a whopping sum of €2.42 billion or $2.7 billion for abusing its “dominance as search engine.” Google has been in the eyes of the storm for a while now, and this hefty fine by the European regulatory commission won’t come to many as a surprise. The commission said its decision is hinged on Google’s “abuse of dominance as search engine by giving illegal advantage to own comparison shopping service.”

The commission thereby issued a 90-day ultimatum by which the search engine giant must have ended its “conduct” or face further penalty payments of up to 5 percent of its daily worldwide turnover.

Commissioner Margrethe Vestager, in charge of competition policy, said: “Google has come up with many innovative products and services that have made a difference to our lives. That’s a good thing. But Google’s strategy for its comparison shopping service wasn’t just about attracting customers by making its product better than those of its rivals. Instead, Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors.

What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.

Earlier report suggested that Google will be slammed with a $1.2 billion fine, but that seems far-fetched now. As a matter of fact, the figure published in earlier report only represented about half the amount the search engine giant has now been fined with by Europe’s regulatory body.

EU AND GOOGLE SEARCH ENGINE

Credit: http://europa.eu/rapid/press-release_IP-17-1784_en.htm

The EU antitrust body opened its investigation against the search engine giant about seven years ago following series of complaints from several companies about how they have been shut-out by Google. Since then, various efforts have been made to reach an agreement with parties involved, but with no concrete agreement reached.

In July 2016, the regulators slammed more charges on Google—extending its investigation beyond search to AdSense and AdWords. The new charges brought against Google was the clearest indication yet that the end was not in sight as it concerns the EU’s investigation.

Apparently Europe’s antitrust regulators had stumbled on more facts to widen its investigation beyond Google’s dominance of the search engine market. The European Commission announced that further Statements of Objections were sent to Google. Brussels accused the search engine giant of abusing its dominant position in search areas that include comparison shopping services. It also said Google “has weakened or even marginalized competition from its closest rivals”. It accused the search engine company of restricting ads that would directly compete against AdSense for Search product.

In 2016, Google started prohibiting AdSense for Search users from accepting rival search ads. The EU deems this as unacceptable and against fair competition—hence today’s charges.

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Author: Ola Ric

Ola Ric is a professional tech writer. He has written and provided tons of published articles for professionals and private individuals. He is also a social commentator and analyst, with relevant experience in the use of social media services.

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