EU Slaps €890m Fine on Google Over Search and App Store Practices

Regulatory Action Against Google

The European Commission has imposed a hefty fine on Google totaling €890m (£760m) for breaches of online competition laws in its search and app store services. The Digital Markets Act (DMA) was cited as the basis for these penalties, with specific fines of €460m for search-related issues and €430m for app store violations.

The European Commission, the EU’s executive arm, accused Google of giving preferential treatment to its own services in search results. For instance, it provided priority placement for shopping and hotel deals, while simultaneously blocking app developers from directing users towards alternative offers or cheaper subscription options. The commission noted that these practices infringed on the DMA by stifling competition and limiting consumer choice.

In response to the ruling, Google is required to ensure that third-party services appear in a fair and non-discriminatory manner within its search results. Additionally, app developers must be allowed to promote their offers outside of Google’s own platform. The company has already begun testing changes to improve compliance, with some progress noted by the commission. These tests include modifications to how search results featuring Google’s own services are displayed, which represent “substantial progress towards compliance.”

The decision is part of a wider effort by EU regulators to address concerns about tech giants' market dominance. Similar fines have already been levied against Apple and Meta for their own competitive practices under the DMA. Apple was fined €500m for anti-competitive practices at its app store, while Mark Zuckerberg’s Meta was ordered to pay €200m in a ruling on its ad-free “consent or pay” proposal for Facebook and Instagram.

Max von Thun, director of the Open Markets Institute Europe thinktank, described the fines as “the bare minimum” for a company that made revenues of just over $400bn last year. He emphasized the need for swift action by the commission to force Google to end its anti-competitive practices and protect European startups and innovators.

The decision to impose the fine risks the ire of former US President Donald Trump, who is set to expire a series of temporary global tariffs against about 60 countries in the near future. A senior official for the EU said they had no knowledge of how Trump was likely to react but insisted that the bloc has the “sovereign right” to regulate US tech companies within its jurisdiction and that the timing of the fine was not connected to global trade tensions.

Google’s president of global affairs, Kent Walker, countered these measures, arguing that the fines would have a negative impact on European businesses and consumers. He stated that the DMA forces Google “to strip away real-time search features Europeans love – like instant pricing and direct availability for hotels, flights, and restaurants – and dismantle safety protections on Google Play.”

Despite these challenges, the EU maintains its determination to enforce competition laws. Google can appeal against the decision and request interim measures, including a potential suspension of the measure.

Source: The Guardian