Google wins European court as €1.5 billion fine overturned

Google has won an appeal against a €1.5 billion fine imposed by the European Commission for breaching antitrust rules, a victory for a major tech group facing increasing scrutiny from Brussels regulators.

The European Union’s general court ruled on Wednesday that while it accepted “most of the Commission’s assessments” that the company had used its dominant position to block competing online advertisers, it had invalidated a hefty fine imposed on Google in the case.

In opening proceedings against Google in 2019, Margrethe Vestager, the bloc’s head of competition, said the search giant had imposed anti-competitive restrictions on third-party websites for a decade, from 2006 to 2016. She justified the €1.5 billion fine by arguing that it reflected the “serious and long-lasting nature” of the infringement.

However, the Court of First Instance in Luxembourg ruled that the Commission, the EU’s executive body, “failed to take into account all the relevant circumstances when assessing the duration of the contractual clauses it found to be unfair”.

The commission, which is likely to appeal, said it had “taken note” of the ruling and would “carefully analyse it and consider possible next steps”.

Google said: “This case involves a very narrow subset of search text ads placed on a limited number of publisher sites. We made changes to our agreements in 2016 to remove the relevant provisions, prior to the commission’s decision. We are pleased that the court recognized the errors in the original decision and overturned the fine. We will carefully review the entire decision.”

The case is one of three in which the EU has fought Google in court in the past few years, resulting in fines totaling around €8.25 billion. Critics say the online advertising market has already been cornered by the tech giant and that antitrust action has been slow and ineffective.

Wednesday’s defeat came after the Commission scored a major victory over Google in a separate case after the European Court of Justice found the search giant had abused its market power by positioning its shopping services above its rivals. In that case, the EU’s top court upheld a €2.4 billion fine imposed on Google.

Brussels still has an open case against Google over its dominance in the ad tech market. Last year, Brussels threatened to break up the company as the only viable solution to the competition issues. The EU is still considering whether to act on the threat and impose further fines on Google, people with direct knowledge of the ongoing case said.

Vestager, who is stepping down from her role as antitrust enforcer in the coming weeks, has accused the tech giants of failing to comply with EU rules.

She recently told the Financial Times: “I’ve had not one, not two, not three cases, but I’m in the middle of my fourth Google case. It makes you think that those who have succeeded in the market still think they shouldn’t compete on the merits.”