EU Court Overturns $1.7 Billion Antitrust Fine Against Google

On September 18, the European Union General Court announced the annulment of a $1.7 billion antitrust fine initially imposed on Google by the European Commission. The penalty revolved around allegations tied to Google’s AdSense advertising platform.

Although the court upheld a substantial portion of the European Commission’s original findings regarding antitrust violations, it determined that the fine itself was not justified. The court stated that the Commission did not adequately consider all relevant circumstances related to the duration of the contract clauses in question, which were deemed abusive.

A spokesperson from Google expressed appreciation for the ruling, highlighting that the case focused on a very specific subset of text-based search ads placed on a limited number of publisher websites. The spokesperson noted that the company had already modified its contracts in 2016 to address the issues before the Commission’s ruling was announced.

“We are pleased that the court has recognized errors in the original decision and annulled the fine,” the Google spokesperson stated. “This case is about a very narrow subset of text-only search ads placed on a limited number of publishers’ websites.”

Back in March 2019, the European Commission found that Google engaged in three distinct infractions of European competition laws linked to specific clauses in its Services Agreement. These clauses reportedly inhibited the ability of competitors to vie with Google’s AdSense for Search advertising service.

Google serves as a mediator for advertisements displayed on third-party websites, and the Commission had alleged that the clauses in question restricted or forbade the display of ads from competing services.

According to the General Court’s ruling, while the Commission had presented findings that were largely upheld, it committed errors in evaluating the duration of the contentious clauses and the market relevant to them back in 2016.

The court noted that the Commission failed to adequately establish that these three clauses constituted an abuse of dominance nor did it prove that they together represented a continuous infringement of Article 102 of the Treaty on the Functioning of the European Union (TFEU). Ultimately, the General Court fully annulled the European Commission’s decision regarding the fine.

The European Commission is now considering its options following the court’s ruling. It retains the right to appeal the annulment and will reportedly assess the decision to determine its next steps.

This ruling could have broad implications for how digital advertising is regulated within the European Union, especially regarding the balance of power between major tech firms and competition authorities. The outcome underscores the complexities involved in antitrust evaluations in the rapidly evolving digital landscape.

As the situation develops, industry observers are closely monitoring the potential reactions from the European Commission and how this ruling might shape future regulatory frameworks for tech companies operating within the EU.