Google has won a court battle with the European Union over a 1.5 billion euro ($1.7 billion) fine for stifling competition in online advertising, somewhat atoning for a crushing defeat last week in a separate ruling that it had abused its monopoly powers.
Judges at the EU’s General Court in Luxembourg backed the Alphabet Inc unit’s challenge to a fine imposed in 2019, saying regulators had made mistakes in their investigation. The European Commission had accused Google — as a major online advertising broker — illegally blocked rivals such as Yahoo Inc and Microsoft Corp from advertising on third-party websites. Wednesday’s ruling can still be appealed to the bloc’s top tribunal, the Court of Justice.
The decision follows two court successes for anti-competition chief Margrethe Vestager in her bid to rein in Silicon Valley. Last week, she won in the top court against Google’s bid to avoid a 2.4 billion euro antitrust penalty for giving its own products preferential results in search and Apple Inc’s bid to avoid a 13 billion euro Irish tax bill.
The EU case over the Google AdSense service is the last of a trio of court disputes that will shape the direction of Vestager’s term, which is due to end after a decade. EU regulators took aim at Google’s role as an advertising broker for websites, where its AdSense product for search delivered ads on platforms including newspaper websites, blogs and travel sites.
When the Brussels watchdog fined Google 1.49 billion euros in 2019, it said Google’s contracts with websites prevented them from accepting search ads from rival companies such as Microsoft and Yahoo. When a user entered a query into the Google search box on a website, ads from such rivals were blocked. All the problematic contracts were cancelled in 2016 when the EU stepped up its investigation.
Despite affirming most of the EU’s arguments, judges in Wednesday’s ruling said regulators had erred in assessing the duration of the disputed clauses as well as the market share they covered during 2016. The court said the EU Commission “has not established that the three clauses it identified constitute an abuse of dominant position and, taken together, constitute a single and continuous violation of antitrust rules.”
At a hearing in the EU’s General Court in 2022, Google’s lawyers described the EU’s 2019 fine as a “quasi-criminal fine of very large proportions.” The EU’s Google cases have formed a centerpiece of Vestager’s efforts to crack down on the growing power of big tech companies. She has fined the Alphabet unit more than 8 billion euros so far and also launched a fourth case into Google’s advertising technology business, suggesting the firm needs to be broken up to address antitrust concerns. A final decision in that investigation is pending.
