Google knew what was coming. A few hours after its announcement, the European Commission announced a new fine to Google for 1,490 million euros in which it is accused of abusive practices with its online advertising services.
It is the third Google fine received by the EU. First, they were 2,420 million euros for their dominant position with Shopping and a year later came the historic fine of 4,340 million euros for using Android as a vehicle to consolidate its dominance in searches. Now, Google loses its third case and is sanctioned for “artificially restricting the possibility that other web pages may display advertising from Google competitors.”
Third case lost by Google before the European Commission
According to the Commission, Google has used its dominant position to impose a series of requirements in different periods of time: exclusivity, preferential display of a minimum number of Google search ads and the right to authorize competitive advertisements.
Commissioner Margrethe Vestager has thus explained the dominant position of Google for which it has been fined: “Today the Commission has fined Google with 1,490 million euros for the illegal use of its dominant position in the market” […] ” During the last 10 years, it has denied other companies the possibility of competing for their own merits and has defined the benefits for consumers of this competition.”
The third @Google case: @Google is fined €1,49bn for illegal practices in search advertising brokering to cement its dominant market position. They shouldn’t do that – it denied consumers choice, innovative products and fair prices.
— Margrethe Vestager (@vestager) March 20, 2019
Only in 2018, Google paid more money in fines to the European Union in taxes worldwide. In total, with this third fine and are 8,300 million euros.
Google argues that Adsense is only a small part of advertising revenue, but according to the European Commission statement, the company had a market share above 70% between 2006 and 2016. A fee that in the case of the search engine exceeds 90% in some markets and prevents competitors such as Microsoft or Yahoo to sell their advertising in Google search results.
The fine of 1,494 million euros represents 1.29% of Google’s turnover in 2018, a calculation that the EU has made based on the value of Google’s revenue from advertising intermediation. This is a figure considerably lower than the maximum of 10% of the last global turnover, which in the case of Google would have meant 11,400 million euros.
The sanction also requires that, at least, Google cease their illegal practices. Although, Google will be able as in previous occasions to appeal the judgment before the European Justice.
More information | European Commission