Google faces a potentially massive fine for breaking antitrust rules in the EU

By Brad Jones June 2, 2017

top tech stories 12 08 2017 google headquarters hq — bennymarty/123RF

For over a year, Google has been the subject of an investigation by the European Commission relating to accusations of anti-competitive practices. Now, there’s word that the company is about to be hit with a likely hefty fine as the Commission prepares to share its findings and administer sanctions.

Companies found to have breached antitrust rules in the European Union can be made to pay a penalty equal to 10 percent of its global turnover, according to a report from Reuters. As a result, Google could in theory be required to pay as much as $9 billion based on its financial performance in 2016.

The European Commission has been looking into this matter for seven years. The investigation was prompted by complaints from rival search engines in the U.S. and Europe, who claimed that Google distorts its search results to give an unfair advantage to its own shopping services.

As well as the fine, it’s likely that the Commission will force Google to modify its practices, although it’s not entirely clear how this action will play out. It’s possible that best practices could be laid out in broad strokes, but there’s also a chance that specific directions could be put in place for the company to adhere to.

Google has previously made three attempts to settle the matter, all of which were unsuccessful. At this point, it seems that the writing is on the wall, and a final ruling is set to be made public before the European Commission’s summer recess, which is scheduled to begin in August.

If Google is found to be guilty of wrongdoing, the decision could have an impact on two other accusations of anti-competitive practices. The company is also being investigated for pursuing an unfair monopoly in relation to both its Android operating system and its AdSense advertising program.

Editors' Recommendations

Topics

Former Digital Trends Contributor

Brad is an English-born writer currently splitting his time between Edinburgh and Pennsylvania. You can find him on Twitter…

Web

Google’s antitrust woes continue as state officials meet with Justice Department

google pop up stores 2018 hardware 35

The antitrust investigation into Google may be about to kick up a notch. In the United States, both the Department of Justice (DOJ) and state attorneys general are probing whether the search giant acted in an anticompetitive manner in two separate investigations. But the two could be about to start sharing information on their respective probes, according to a report in the Wall Street Journal.

News

50 U.S. states and territories announce an antitrust investigation of Google

Google-CEO-Sundar-Pichai-i-o-2018

Fifty U.S states and territories announced an antitrust investigation into Google on Monday, focusing on the company’s advertising practices and its control over internet search.
Texas Attorney General Ken Paxton, who is leading the investigation, said that Google “dominates all aspects of advertising on the Internet and searching on the Internet."
Paxton noted, however, that this was merely an antitrust investigation into the company’s practices, not a lawsuit -- at least, not yet.
“There is nothing wrong with a business becoming the biggest game in town if it does so through free market competition, but we have seen evidence that Google’s business practices may have undermined consumer choice, stifled innovation, violated users’ privacy, and put Google in control of the flow and dissemination of online information," Paxton, a Republican, said in a statement announcing the bipartisan investigation. "We intend to closely follow the facts we discover in this case and proceed as necessary.”
Reports of the bipartisan investigation into the company originally surfaced last week. The probe includes the attorneys general from 48 states as well as the District of Columbia and Puerto Rico. Google’s home state of California and Alabama are the only U.S. states not involved in the investigation.
We reached out to Google for comment on the antitrust investigation and will update this story if we receive a response.
In July, the Justice Department announced that it would be opening a broad antitrust investigation into the nation’s largest tech companies, including Google, Facebook, Amazon, and Apple.
That investigation is reportedly going to be focused on “whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers,” according to a press release.
“The open internet has delivered enormous benefits to Americans, including a surge of economic opportunity, massive investment, and new pathways for education online,” said House Judiciary Chairman Jerrold Nadler (D-NY) in June. “But there is growing evidence that a handful of gatekeepers have come to capture control over key arteries of online commerce, content, and communications.”

When asked about the Justice Department’s move earlier this year, a spokesman for Google pointed to part of the testimony by Adam Cohen, the company’s director of economic policy, before the House Judiciary Committee: “In the face of intense competition, we are proud of our record of continued innovation,” Cohen said. “We have helped reduce prices and expand choice for consumers and merchants in the U.S. and around the world. We have created new competition in many sectors, and new competitive pressures often lead to concerns from rivals. We have consistently shown how our business is designed and operated to benefit our customers.”

Mobile

Google wants to profit on search engine choice. The EU is keeping a close eye

Google must let Android users in Europe choose their default search engine app and web browser, as a measure to rectify one of the violations in the European Union’s antitrust case and subsequent $5 billion fine against the search engine giant.

Naturally, Google’s found a way to profit from and tax its competitors.