Brussels
The fine is the largest the European Union has levied against a company for abusing its dominant position, and marked the latest confrontation over business practices between EU regulators and American tech giants. Google could face dizzying additional penalties if it loses an expected appeal and fails to comply.
If the ruling stands, it could reshape the company’s behavior in one of its most lucrative markets. And the way Google presents its search results could shift worldwide.
The landmark EU decision also sets up a wider clash — touching on whether government regulators hold power over one of the world’s most dominant companies, and testing the limits of competition-regulating rules in an age of borderless commerce and online interactions.
“Google has abused its market dominance in its search engine by promoting its own shopping comparison service in its search results and demoting its competitors,” EU competition chief Margrethe Vestager told reporters in Brussels.
“What Google has done is illegal under EU antitrust rules. It has denied other companies the chance to compete on the merits and to innovate. And most importantly, it has denied European consumers the benefits of competition.”
The decision reinforced Vestager’s emerging role as the world’s most aggressive antitrust regulator, following on a $14.6 billion back-tax judgment against Apple last year.
The announcement caps a seven-year investigation into Google’s trade practices. Other related cases against Google are ongoing.
Google — which is considering an appeal — issued a statement minutes after the EU announcement, claiming the company’s shopping site helps both consumers and advertisers.
“When you shop online, you want to find the products you’re looking for quickly and easily. And advertisers want to promote those same products,” Google senior vice president and general counsel Kent Walker said in a statement.
“That’s why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both. We respectfully disagree with the conclusions announced today,” he said. “We will review the Commission’s decision in detail as we consider an appeal, and we look forward to continuing to make our case.”
Under European rules, it is up to Google to find a way to comply with the judgment, and Vestager offered no specific guidance about how it must modify its services.
If it does not abide by the ruling within 90 days, however, Google could face penalties of up to five percent of the daily turnover of Alphabet Inc., its corporate parent, which could be backdated years.
Alphabet shares were down slightly in midday trading on Wall Street.
The holder of the previous record fine was Intel, the chip manufacturer, which was hit with a $1.2 billion penalty in 2009.