- The initial fine was 4,343 million euros and was reduced to 4,125 million euros.
- The sentence can still be appealed before the highest instance, the Court of Justice of the EU.
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| European justice confirms the historic fine to Google for violating competition in the Android case |
European justice confirms the historic fine to Google for violating competition in the Android case
The General Court of the European Union partially upheld Google's appeal against the European Commission on Wednesday and reduced to 4,125 million euros the fine that Brussels imposed on it in 2018 for considering that it applied illegal restrictions to device manufacturers that use its operating system. Android to secure its dominant position.
The initial fine was 4,343 million euros. The sentence can still be appealed before the highest instance, the Court of Justice of the EU.
Why was Google fined?
The European Commission fined Google, first, for forcing Android device manufacturers to install the Google Search browser and the Google Chrome browser in exchange for giving them the license of the Play Store, the company's mobile application store.
Second, for preventing companies that wanted to sell mobile phones and tablets with Google applications from installing alternative versions of the operating system on mobile devices, known as "Android forks".
And, finally, for making a part of Google's advertising revenue subject to manufacturers and mobile network operators not installing any other search engine alternative to Google Search.
Sentence
In its ruling this Wednesday, the TGUE accepted the arguments of the Community Executive that the obligation to install Google Search and Google Chrome could give rise to a "status quo bias", due to the "propensity of users" to use applications already installed on their mobile phones and tablets, "without that advantage being offset by Google's competitors."
"None of the criticisms made by Google undermines the Commission's analysis on this point," the Luxembourg-based court said.
The judges also stated that "the Commission could reasonably consider" that the dependence of advertising revenue on the non-installation of competing applications "constituted exclusivity agreements".
However, the ruling dismissed the arguments made by Brussels to consider that these agreements were "abusive", in such a way that Google had the capacity to restrict competition on the merits of its competitors.
On the one hand, the TGUE stated that Brussels' finding that such agreements affected "a significant part of the national markets for general search services" "is not corroborated by the elements presented by the Commission".
"Errors of Reasoning"
On the other hand, it observed "several errors of reasoning" by the Commission in the so-called "equally effective competitor" test, which assesses the possibilities that a rival Google company would have had to compete in search services if its application had been installed on the devices.
Those assessment errors in the Commission's estimate of the costs attributable to such a competitor, its ability to achieve pre-installation of its application, and the revenue that could be obtained based on the age of the mobile devices in circulation.
The TGUE also considered that Google's restrictions on the sale of mobile devices with alternative Android systems made it possible to reinforce its dominant position in the search service markets and constituted a brake on innovation, limiting the offers available to users.
Arguments dismissed
In addition, the court rejected Google's argument about the ability of Apple or Blackberry to compete as equals, since, according to the court, their operating systems "are not part of the same market" because manufacturers cannot obtain licenses for the software, as if it happens with the open source of Android.
Finally, the TGUE dismissed Google's arguments regarding the alleged violation of the right to defense.
Google "disappointed" by the sentence
The Google company said on Wednesday it was "disappointed" because the General Court of the European Union "has not completely annulled" the fine of 4,343 million euros that Brussels imposed in 2018 for applying illegal restrictions to manufacturers of Android devices to " strengthen its dominant position.
"Android has created more options for everyone, not less, and supports thousands of successful businesses in Europe around the world," a Google spokesman said in a statement issued after the ruling, which the company is reviewing before "deciding on next steps" to take.
Android, successful and viable
Google believes that Android is "the only example of a successful and viable open source operating system" and that it gives users more possibilities than any other platform to download and install applications other than those offered by default on mobile phones and tablets.
It also ensures that after the fine imposed by the Commission, it decided to separate the Google Search license from that of Google Play and went even "further", offering users the possibility of installing alternative search engines and browsers to theirs.
Last November, the TGUE confirmed the fine of 2,424 million euros that Brussels imposed on Google in 2017 for having favored its price comparison system over those of the competition.
In addition, it has yet to decide on another penalty of 1,490 million euros, for abuse of a dominant position in Internet advertising through its AdSense for Search service.
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