Google Loses Appeal Against EU Antitrust Ruling

Image credit: European Commission

Google’s appeal against $2.8 billion antitrust fine issued in 2017 after investigation of its price comparison shopping service, has been dismissed

Alphabet has received some bad news on Wednesday, after the EU’s General Court in Luxembourg dismissed Google’s appeal against one of three EU antitrust rulings.

The ruling will be welcomed by the European Commission and in particular by Competition Commissioner Margrethe Vestager, who has overseen a number of antitrust fines against big name tech firms in recent years.

Google itself is facing billions of euros of antitrust fines, as the Commission has levied a total of more than 8 billion euros (£6.84bn) in fines against in in recent years and has ordered it to change its business practices on multiple fronts.

EU competition commissioner Margrethe Vestager.  European Commission
Margrethe Vestager.  European Commission

Shopping appeal

The first significant fine against Google was levied in 2017, when the European Commission fined it 2.4bn euros after it ruled that Google had thwarted rivals of its shopping comparison service.

The next significant fine came in July 2018, when the European Commission fined Google a record 4.3 billion euros for commercial practices related to its Android mobile operating system, the world’s highest ever antitrust penalty.

This was followed in March 2019 when Google was once again been hit with a hefty financial penalty from European antitrust regulators. That fine concerned the firm’s AdSense advertising service and Google was ordered to pay 1.49bn euros.

In February 2020 Google began its appeal against the 2.4 billion euros penalty imposed by the European Commission over its alleged abuse of power in promoting its own shopping comparison service.

Court ruling

And now the General Court has issued its ruling and said in a statement it “upholds the fine of €2.42 billion imposed on Google.”

“By decision of 27 June 2017, the Commission found that Google had abused its dominant position on the market for online general search services in 13 countries in the European Economic Area, by favouring its own comparison shopping service, a specialised search service, over competing comparison shopping services,” said Europe’s second highest court.

“The Commission found that the results of product searches made using Google’s general search engine were positioned and displayed in a more eye-catching manner when the results came from Google’s own comparison shopping service than when they came from competing comparison shopping services,” it added. “Moreover, the latter results, which appeared as simple generic results (displayed in the form of blue links), were accordingly, unlike results from Google’s comparison shopping service, prone to being demoted by adjustment algorithms in Google’s general results pages.”

“In respect of that infringement, the Commission imposed a pecuniary penalty on Google of €2 424 495 000, of which €523 518 000 jointly and severally with Alphabet, its parent company,” the court added.

“Google and Alphabet brought an action against the Commission’s decision before the General Court of the European Union,” it said. “By its judgement today, the General Court dismisses for the most part the action brought by the two companies, and upholds the fine imposed by the Commission.”

Bad news

The decision is potentially bad news for Google, as the firm could face defeats in its appeals against the other two rulings involving Android and its AdSense advertising service, where antitrust specialists have reportedly said the EU has stronger arguments.

The court’s support for the Commission in its latest ruling could also strengthen Vestager’s hand during her investigations into Amazon, Apple and Facebook.

However there was a silver lining for Google on Wednesday, after the UK’s Supreme Court blocked a planned $4.3 billion class action against Google over allegations it unlawfully tracked the personal information of millions of iPhone users.