tutor2u | Record fine for Google in anti-trust case

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Record fine for Google in anti-trust case

Geoff Riley

28th June 2017

Google has been fined 2.42bn euros (£2.1bn) by the EU Competition Commission after it ruled the company had abused its market power by promoting its own shopping comparison service at the top of Google search results. The company must now end the conduct within 90 days or face penalty payments of up to 5% of the average daily worldwide turnover of Alphabet, Google's parent company. That fine would be in excess of Euro 12 million per day!

Google hit with record EU fine over Shopping service

Here is the ruling from the EU Competition Commission:

"Google has come up with many innovative products and services that have made a difference to our lives. That's a good thing. But Google's strategy for its comparison shopping service wasn't just about attracting customers by making its product better than those of its rivals. Instead, Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors.

What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation."

The crucial point is that market dominance is not illegal under EU antitrust rules. However, dominant companies have a special responsibility not to abuse their powerful market position by restricting competition, either in the market where they are dominant or in separate markets.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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