The European Commission today slapped Google with a staggering fine of €2.42 billion ($2.7 billion) for using its dominant search position to unfairly promote its own comparison shopping service over its competitors.
As per EU’s announcement, Google has to end its unfair conduct within 90 days or it will end up facing a penalty of up to 5% of the average daily worldwide turnover of Alphabet, Google’s parent company. This could translate into an additional fine of up to $15 million a day. The body calculated the fine on the “basis of the value of Google’s revenue from its comparison shopping service” in 13 European countries.
The EU notes that Google has “systematically given prominent placement” to its own comparison shopping service and has “demoted rival comparison shopping services” in its search results. This is a clear breach of EU’s antitrust rules and an unfair use on Google’s part of its dominant position in the search engine market to promote its own products. The unfair practice led to a 45-fold increase in Google’s comparison shopping service in the UK, 35x in Germany, 19x in France, and 14x in Italy.
It is now Google’s responsibility to adhere to EU’s ruling and explain how it plans on doing so within 90 days. The Commission will also be monitoring the steps taken by Google closely for the first 60 days which will be followed by periodic reports.
The EU is also investigating Google for abusing its dominant position in the smartphone market using Android and by not allowing third-party publishers to display ads from services that compete with Adsense.
Google on its part has said that it disagrees with the EU’s conclusions. It will be reviewing its decision in detail and “consider an appeal.”[Via EU, Google]