European Commission has downloaded a $1 billion fine imposed on Google over alleged competition law violations.
A European Commission investigation found that Google had abused its dominant market position European Union search and app store markets to direct people to its own apps and services, in breach of the EU Digital Markets Act.
The authority ordered Google to refrain from giving preferential treatment to its own services – such as shopping, accommodation, transport and flights – in search rankings. Google must also allow app developers to communicate and transact with users outside of the Play Store, where a commission is collected on sales.
“The best products should succeed because they are better, not because they belong to the company operating the search engine,” says Teresa Ribera, executive vice president of the European Commission. “European consumers have the right to be told by app developers where to sign up to get the best deals, even if the app store owner doesn’t receive any discount.”
In a statement to WIRED, Google said it would consider appealing the fine.
“This is not fair competition; it is product degradation caused by a small group of selfish complainants, and European businesses and consumers will suffer,” says Kent Walker, president of global affairs at Google.
Tech industry associations argue that exacting enforcement of the Digital Markets Act is futile. “Reducing the quality of what Europeans have access to is not a positive impact,” Daniel Friedlaender, senior vice president of trade body CCIA Europe, tells WIRED.
Over the past decade, the EU has imposed numerous multi-billion dollar fines on Google over a number of antitrust violations. At the beginning of July, the European Court of Justice upheld a record fine of $4.1 billion brought against Google in 2018 in connection with agreements requiring phone manufacturers to install the Google search engine and Chrome web browser on their devices.
“There’s certainly a lot at stake for companies. Ranking has a huge impact on their business,” says Kathryn McMahon, associate professor of law at the University of Warwick. “From the point of view of EU competition law, companies in a dominant position – such as Google – have a special responsibility not to distort competition.”
To respond to the latest complaints, Google has proposed changes to the way it administers the Play Store and presents its products in search rankings, which the EC described as “progress towards compliance.”
Most recently, US President Donald Trump announced the imposition of new, high tariffs at European countries that are trying to restrict American technology companies. The White House did not respond to a request for comment.
The latest penalty is “a pretty strong response in the context of transatlantic grievances – a way for Trump to use penalties,” McMahon says. “This shows that the Commission is willing to be tough.”