The European Union has fined Google EU€2.95 billion (A$5.27 billion) for anti-competitive advertising technology practices, with United States President Donald Trump threatening trade penalties on the EU in return.
The EU alleged Google favoured its own advertising technology platforms, including ad exchange AdX, by offering advanced information on competitors’ ad selection bids. This was aimed at intentionally giving AdX an advantage, said the EU.
“Today’s decision shows that Google abused its dominant position in adtech harming publishers, advertisers, and consumers. This behaviour is illegal under EU antitrust rules,” said Teresa Ribera, European Commission executive vice president for Clean, Just and Competitive Transition.
“Google must now come forward with a serious remedy to address its conflicts of interest, and if it fails to do so, we will not hesitate to impose strong remedies.”
Google informed AdX in advance of the value of competitors’ highest bids, according to the EU Its Google Ads and DV360 ad buying tools also mainly placed bids on AdX rather than on competitors, which the EU said would make AdX a more appealing ad exchange.
The EU has ordered Google to end this allegedly self-preferential behaviour and to add new measures to end conflicts of interest. Google has 60 days to give the European Commission its plans to do so, though the company has said it will appeal the decision.
Trump has said he will contest the fine with the EU: “We cannot let this happen to brilliant and unprecedented American Ingenuity and, if it does, I will be forced to start a Section 301 proceeding to nullify the unfair penalties being charged to these Taxpaying American Companies,” he wrote on Truth Social.
This would allow the U.S. to impose trade penalties, including tariffs, on countries that may burden U.S. commerce, under Section 301 of the Trade Act of 1974.
The EU and the U.S. reached an agreement to lower baseline tariffs on the EU to 15% in July. E.U. regulators reportedly delayed announcing the fine while awaiting the U.S. decision on lowering tariffs on European cars from 27.5% to 15%.
U.S. District Court judge Amit Mehta also determined last year that Google had violated antitrust law by maintaining a monopoly in the advertising and online search markets. Mehta ruled in August that Google would not have to sell its Chrome browser, as the U.S. Justice Department had requested.
Google parent company Alphabet's (NASDAQ: GOOG) share price closed at US$235.17 on Friday, up from a previous close at $232.66. Its market capitalisation is $2.84 trillion.
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