Google has successfully appealed a €1.5 billion fine imposed by the European Commission, marking a significant legal victory for the tech giant amid heightened scrutiny from EU regulators. The EU’s General Court announced on Wednesday that although it acknowledged much of the commission’s findings that Google misused its dominant market position to hinder rival online advertisers, the court decided to annul the substantial fine.
The original action against Google was initiated in 2019 by Margrethe Vestager, the European Union’s competition commissioner, who accused the company of enforcing anti-competitive restrictions on third-party websites for a decade, from 2006 to 2016, to secure its market dominance. Vestager argued that the hefty fine reflected the ‘serious and sustained nature’ of the infringement.
The Luxembourg-based General Court noted that the European Commission had failed to consider all relevant circumstances, particularly regarding the duration of the clauses deemed anti-competitive. In response, the commission indicated it had taken ‘note’ of the judgment and would ‘carefully study the judgment and reflect on possible next steps.’ Further appeals are likely.
Google stated, ‘This case is about a very narrow subset of text-only search ads placed on a limited number of publishers’ websites. We made changes to our contracts in 2016 to remove the relevant provisions, even before the commission’s decision. We are pleased that the court has recognized errors in the original decision and annulled the fine. We will review the full decision closely.’
This case is one of three brought by the EU against Google in recent years, culminating in fines totaling around €8.25 billion. Critics argue that Google’s dominant position in the online advertising market has been inadequately checked by regulatory measures.
Despite Wednesday’s favorable ruling for Google, the European Commission recently secured a win in a different case where the European Court of Justice upheld a €2.4 billion fine against Google for abusing its market power by favoring its shopping services over competitors’.
Additionally, the EU continues to probe Google’s dominance in the ad tech sector, with previous threats to break up the company as a potential remedy. The European Commission has yet to decide if it will pursue this course of action following the latest court decisions.
Margrethe Vestager, who is set to step down from her role soon, has been a vocal critic of large tech firms, accusing them of circumventing EU regulations. ‘I’ve had not one, not two, not three but I am on my fourth Google case. It is thought-provoking that those who have made it in the marketplace still feel that they should not compete on the merits,’ she told the Financial Times recently.
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