Google loses key appeal against 2.4 billion European antitrust case for shopping

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The EU’s second-oldest court, the General Court, upheld a 2017 European Commission ruling that found that Google broke antitrust law in the way it used its search engine to promote its comparison service. purchases and demote those of his rivals.

Google and its parent company Alphabet appealed the decision, but today the court dismissed that appeal and upheld a $ 2.4 billion ($ 2.8 billion) fine. Google and Alphabet now have the option to appeal the decision once again in the EU’s highest court, the European Court of Justice (ECJ).

This is one of three antitrust cases prosecuted against Google

This finding is significant as it strengthens the antitrust arguments put forward by influential European Commissioner for Competition Margrethe Vestager against US tech companies. In addition to this purchase comparison case, Google has been hit by two other major antitrust cases involving Android and AdSense in 2018 and 2019 respectively. These cases are now going through a similar appeals process to what Google lost to Google today. Shopping.

The key to Vestager’s legal argument in this and other antitrust cases is the concept of self-preference to the idea that a company like Google can violate antitrust law by using a dominant position in a market (in the case of Google, search) to help her succeed in another (in this case, purchases). Self-preference is not in itself a violation of EU antitrust law, but its potentially damaging effects such as choking on better products made by rivals are.

In its ruling today, the EU General Court said it saw sufficient evidence that Google’s behavior in this area was harmful. The company, the court said, violated antitrust law by favoring its comparison shopping service on its overall results pages through more favorable display and ranking, while relegating the results of competing comparison services to those pages by using algorithms of ranking.

As self-preference is common in the tech world with companies often reaching scale by focusing on a single product before expanding to neighboring services, this judgment will reinforce other antitrust arguments put forward by the EU.

Today’s ruling gives the European Commission the ammunition it needs to tighten the screws on Google

Today’s ruling gives the European Commission the ammunition it needs to screw up Google in other areas where it is exerting its weight, such as online advertising, app stores and video streaming, said Thomas Vinje, legal advisor. by FairSearch, an industry association of Google’s competitors, in a release. This victory is only the first step.

However, despite the celebrations of Google’s rivals, the case also shows the extreme limits of the EU’s ability to effectively address antitrust cases in the tech world. The original complaint in this case was filed over a decade ago in 2009, and today’s decision may not even be the final ruling if Google and Alphabet decide to appeal to the Court of Justice. In response to the 2017 ruling, Google made changes to its business model, allowing rivals to bid to appear in shopping search results, but rivals said this just created a new revenue stream for the. company without addressing Google’s underlying advantage. Between the slow decision-making process and the perceived inadequacy of Google’s changes by its rivals, many will question whether the EU antitrust work is really worth the effort.

Meanwhile, antitrust advocates in the EU are already turning their focus to the next big blockade legislative proposal to level the playing field with US tech companies: the Digital Markets Act, or DMA. This act was proposed by the European Commission in December 2020 and would force technology platforms to make new concessions to smaller rivals. However, even if the DMA were approved by EU lawmakers, it would not be implemented before 2023. Speed ​​is certainly not in the nature of the EU.

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