The European Commission on July 18 fined Google €4.34 billion (U.S. $5.05 billion) for breaching EU antitrust rules.
Since 2011, Google has imposed illegal restrictions on Android device makers and mobile network operators to cement its dominant position in general internet search. “These practices have denied rivals the chance to innovate and compete on the merits,” said Commissioner Margrethe Vestager, who is in charge of competition policy.
“They have denied European consumers the benefits of effective competition in the important mobile sphere,” Vestager said. “This is illegal under EU antitrust rules.” The Commission’s case concerns three types of restrictions that Google has imposed on Android device makers and network operators to ensure that traffic on Android devices goes to the Google search engine, she said.
Specifically, according to the Commission, Google:
Required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google’s app store (the Play Store);
Made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices; and
Prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called “Android forks”).
The duration and gravity of the infringement accounts for the €4.34 billion fine, the Commission said. In accordance with the Commission’s 2006 Guidelines on fines, the fine has been calculated based on the value of Google’s revenue from search advertising services on Android devices in the EEA.
At a minimum, Google must stop and not re-engage in any of the three types of practices. The decision also requires Google to refrain from any measure that has the same or an equivalent object or effect as these practices.
“It is Google’s sole responsibility to ensure compliance with the Commission decision,” the Commission stated. “The Commission will monitor Google's compliance closely, and Google is under an obligation to keep the Commission informed of how it will comply with its obligations.”
Google must now bring the conduct effectively to an end within 90 days, or face penalty payments of up to 5 percent of the average daily worldwide turnover of Alphabet, Google’s parent company.
Google may also face civil actions for damages that can be brought before the courts of the Member States by any person or business affected by its anti-competitive behavior. The new EU Antitrust Damages Directive makes it easier for victims of anti-competitive practices to obtain damages.
Other Google cases
In June 2017, the Commission fined Google €2.42 billion for abusing its dominance as a search engine by giving an illegal advantage to Google’s own comparison shopping service. The Commission said it’s currently actively monitoring Google’s compliance with that decision.
The Commission said it also continues to investigate restrictions that Google has placed on the ability of certain third-party Websites to display search advertisements from Google’s competitors (the AdSense case). In July 2016, the Commission came to the preliminary conclusion that Google has abused its dominant position in a case concerning AdSense.