In a landmark ruling on September 18, 2024, Google’s ongoing legal battle with the European Union over a $1.7 billion antitrust fine took a significant turn. The European Union’s General Court annulled the hefty fine that was imposed back in 2019.
The case centered on Google’s AdSense advertising platform, which was accused of restricting competition by placing exclusive clauses in contracts with third-party websites. These clauses allegedly prevented publishers from showing ads from Google’s rivals.
Background of the Case
The European Commission originally fined Google €1.49 billion ($1.7 billion) in 2019 after concluding that Google had abused its market dominance in the online advertising space. The Commission claimed that Google’s actions between 2006 and 2016 prevented competition from flourishing by forcing publishers to adhere to restrictive conditions, essentially locking out rivals from using their ad services.
Google, however, appealed the decision, arguing that the clauses in question affected only a narrow group of search ads. In their defense, they noted that the contractual provisions had been removed in 2016, even before the Commission’s decision, making the penalty unjust.
The Court’s Ruling
The EU General Court’s ruling overturned the original fine while supporting the majority of the Commission’s findings. The judges found that while Google had engaged in some anti-competitive behavior, the European Commission made errors in assessing the duration of the contract clauses deemed abusive.
According to the court, the Commission failed to fully consider the broader market implications and the actual length of time during which the restrictive clauses were active.
Despite annulling the fine, the court acknowledged the importance of competition in the online advertising market but also stressed that the Commission did not adequately prove that these clauses significantly harmed the market or consumers.
Google welcomed the decision, expressing satisfaction that the court recognized key errors in the initial ruling.
What’s Next?
Although Google celebrated this victory, the case may not be entirely closed. The European Commission has the right to appeal the ruling to the Court of Justice of the European Union (CJEU), which would bring the case to the EU’s highest court.
The Commission has stated that it will review the court’s decision and consider its next steps, potentially setting the stage for further legal challenges.
This case is part of a larger series of antitrust actions taken by the EU against Google, including fines related to its shopping comparison services and Android mobile operating system. Whether or not the Commission decides to appeal this ruling, it reflects the ongoing regulatory scrutiny tech giants like Google face in Europe.
