EU fines Google record $3.8b in antitrust case

Tech giant was probed over complaints that it abused power to muscle out smaller rivals

FRANKFURT • Google was fined a record €2.42 billion (S$3.8 billion) by the European Union yesterday, wrapping up a seven-year probe into complaints that it abuses its power as the world's biggest search engine to muscle out smaller shopping search rivals.

This is the biggest fine for a single company in an EU antitrust case, exceeding a €1.06 billion sanction handed down to US chipmaker Intel in 2009.

Alphabet's Google has 90 days to "stop its illegal conduct" and give equal treatment to rival price-comparison services, according to a binding order from the European Commission yesterday.

It is up to Google to choose how it does this, and it must tell the EU within 60 days of its plans. Failure to comply brings a risk of fines of up to 5 per cent of its daily revenue.

"Google's strategy for its comparison-shopping service wasn't just about attracting customers by making its product better than those of its rivals," said Ms Margrethe Vestager, the EU's antitrust chief. "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."

Google said it "respectfully" disagreed with the EU decision, and was considering an appeal.

"We will review the (European) Commission's decision in detail as we consider an appeal, and we look forward to continuing to make our case," Mr Kent Walker, the company's senior vice-president and general counsel, said in a statement.

  • 90 Number of days Alphabet's Google has to "stop its illegal conduct" and give equal treatment to rival price-comparison services.

Yesterday's fine could just be the first in a series of EU antitrust penalties for Google, which is fighting on at least two other fronts, including its Android mobile phone software and the AdSense online advertising service. Publishers are also seeking a probe into claims that Google unfairly uses their content, causing them to lose lucrative advertising revenue.

Complaints were from small shopping websites as well as bigger names, including News Corp and Microsoft. European politicians have called on the EU to sanction Google or even break it up, while United States critics claim regulators are targeting successful US firms.

The decision follows Russia's US$7.8 million (S$10.8 million) antitrust fine and penalties from the Italian, German and French privacy authorities.

While the penalty is a record, it will do little to faze a company whose parent has more than US$90 billion in cash.

But a "non-discrimination obligation" imposed on Google could make a "bigger difference to a broader number of companies and make a massive difference to Google and its ability to self-promote its own stuff", said Mr Tim Cowen, a lawyer at Preiskel & Co.

"That could restructure the way in which people find things on the Internet."

BLOOMBERG, REUTERS

A version of this article appeared in the print edition of The Straits Times on June 28, 2017, with the headline 'EU fines Google record $3.8b in antitrust case'. Print Edition | Subscribe