European Commission Fines Google $2.7 Billion

Google was fined on Tuesday by the European Commission $2.7 billion after the EC ruled the company abused its power through promoting its shopping comparison service at the top of its search results.

The fine is the largest the European Union regulator has handed out to date to a company due to distorting the market.

The Tuesday ruling ordered Google as well to end its practices of anti-competitiveness within the next 90 or another penalty will be enforced.

Google announced that it may appeal the EC decision.

However, if Google does not change its method of operating its Shopping service within the deadline of 90 days, the EC could force it to make payments of 5% of Alphabet’s daily earnings worldwide. Alphabet is the parent company of Google.

Based on the most recent financials for the company, 5% of the daily earnings for Alphabet would amount to $14 million per day.

Margrethe Vestager the Competition Commissioner of the EU said that Google’s practices were illegal under antitrust rules in the EU.

Google had suggested previously that eBay and Amazon had more influence on the spending habits of the public and said again that it does not accept claims that were made against it.

A spokesperson in response to Tuesday’s ruling said that when someone shops online, they want to find products they are looking for both easily and quickly.

The spokesperson continued by saying advertisers want to promote the same products and that is why Google shows ads for shopping, connecting users of Google with advertisers both large and small in ways both are able to gain.

The spokesperson added that Google respectively disagrees with conclusions that were announced by the EC and will review the decision handed down by the Commission while considering an appeal.

This decision may be precedent setting that could determine how the civil service of the EU handles complaints that are related about the prominence Google gives its own flight price, maps and local business listings in its own search tools.

Shopping by Google displays the relevant products through images and prices next to names of places that they can be purchased with review scores if they are available.

The details have a label “sponsored” next to them reflecting that unlike normal results from a search, they only have items that sellers paid to have appear.

Google benefits as well from its Shopping services ads being more visual than ads that are text based.

Latest News

Leave a Reply