Google loses appeal of EU fine over shopping searches

By Kelvin Chan
AP Business Writer

LONDON (AP) — A top European Union court on Wednesday rejected Google’s appeal of a 2.4 billion euro ($2.8 billion) fine from regulators who found the tech giant abused its massive online reach by giving its own shopping recommendations an illegal advantage in search results.

The European Commission, the 27-nation bloc’s top competition watchdog, punished Google in 2017 for unfairly directing visitors to its own shopping service, Google Shopping, to the detriment of competitors. The EU’s General Court dismissed Google’s appeal of that antitrust penalty and upheld the fine.

“The General Court thus rules that, in reality, Google favors its own comparison shopping service over competing services, rather than a better result over another result,” it said in a press release.

Google said it made changes in 2017 to comply with the European Commission’s decision.

“Our approach has worked successfully for more than three years, generating billions of clicks for more than 700 comparison shopping services,” a Google statement said.

The fine was part of an effort by European regulators to curb the online giant’s clout on the continent. It was followed by two other blockbuster antitrust penalties against Google, totaling 8.25 billion euros ($9.5 billion), which the company also is appealing. The fines are a drop in the bucket for Google’s parent company, Alphabet Inc., which earned $182 billion in revenue last year.

The penalties were early salvos in the EU’s crackdown on tech companies, which has expanded to include other Silicon Valley digital giants. The commission this year launched fresh antitrust investigations into whether Google and Facebook are stifling competition in digital and classified advertising markets. It’s also investigating Apple over payments and Amazon over concerns it’s unfairly competing against independent merchants on its platform with its own products.

Meanwhile, the EU also is drafting new digital rules to rein in online services by making them more accountable for illegal goods and harmful content found on their platforms, with the threat of fines worth up to 10% of global annual revenue.

Wednesday’s ruling can still be appealed to the European Court of Justice, the bloc’s highest court, but only on points of law, not the facts. Google hasn’t decided whether to do so, saying it will closely review the decision.

The case began after the European Commission received a complaint in 2009. It dragged on as fruitless attempts to negotiate a settlement delayed the final decision, drawing criticism that the commission wasn’t acting fast enough to stop Google from cornering online markets.

That’s something the European Commission is trying to address with its new digital rules, which aim to prevent bad behavior, rather than punishing past actions as it has previously done. It also has started using “interim measures” as a speedy way to halt anticompetitive behavior while investigations are carried out.

The commission welcomed the court’s new ruling.

“The judgment today delivers a clear message that Google’s conduct was unlawful and it provides the necessary legal clarity for the market,” spokesperson Arianna Podesta said in a press briefing in Brussels.