EU Court Reverses $1.7B Fine Against Google, Marking a Major Legal Win
The EU General Court has overturned a hefty $1.7 billion fine against Google, ruling that the European Commission made errors in its assessment of the tech giant’s advertising contracts. This decision highlights ongoing regulatory challenges in the digital market.
KEY INSIGHTS
- The EU General Court has nullified a $1.7 billion fine imposed on Google in 2019 for alleged anti-competitive advertising practices.
- The original penalty accused Google of abusing its dominant market position to limit rival advertisers.
- This ruling follows shortly after Google lost an appeal against a separate $2.7 billion antitrust fine related to its shopping services.
In a significant legal development, Alphabet’s Google has successfully challenged a nearly 1.5 billion euro ($1.7 billion) fine imposed by the European Union in 2019. The fine was originally levied on allegations that Google misused its dominant position to restrict competitors in the advertising space.
The EU General Court found that the European Commission made critical errors in evaluating the duration and nature of Google's advertising agreements with publishers. This verdict arrives just days after Google failed to overturn a $2.7 billion antitrust penalty concerning preferential treatment of its shopping services.
Google Highlights Contract Changes Preceding EU Ruling
Google emphasized that the case pertains to a very specific subset of text-only search ads on a limited number of publisher sites. The company stated that it had already modified its contracts in 2016 to remove the contentious clauses well before the Commission's 2019 decision.
“We are pleased the court identified errors in the original ruling and annulled the fine. We will carefully analyze the full decision,” Google said in a statement.
In 2022, the EU enacted the Digital Markets Act to regulate large tech firms, promoting fair competition, innovation, better quality, and lower prices. The compliance deadline for affected companies was March 6, 2024.
Following the ruling, Alphabet shares dipped slightly by 0.4% midday but remain up nearly 15% for the year.
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