Google fined £1.27bn for breaching EU competition laws

Google has been fined £1.27bn for breaching EU competition laws between 2006 and 2016 Credit: Nick Ansell/PA

Google has been fined 1.49 billion euros (£1.27 billion) by the European Commission for alleged illegal practices in search advertising.

The company is accused of breaching EU competition laws between 2006 and 2016, European Commissioner for Competition Margrethe Vestager said in Brussels on Wednesday morning.

Google allegedly abused its market dominance in the advertising sector by imposing a number of restrictive clauses in contracts with third-party websites, prohibiting publishers from placing any search adverts from competitors on their search results pages.

In 2009, it is claimed the company began replacing these clauses with new requirements for publishers to reserve the most profitable space on their search results pages for Google’s adverts.

Google’s business model is largely reliant on selling adverts, which generated revenue of 32.6 billion dollars (£28.7 billion) in its last quarterly results.

“Today the Commission has fined Google 1.49 billion euros for illegal misuse of its dominant position in the market for the brokering of online search adverts,” Ms Vestager said.

“Google has cemented its dominance in online search adverts and shielded itself from competitive pressure by imposing anti-competitive contractual restrictions on third-party websites. This is illegal under EU antitrust rules.

“The misconduct lasted over 10 years and denied other companies the possibility to compete on the merits and to innovate – and consumers the benefits of competition.”

Google’s senior vice president of global affairs, Kent Walker, responded, saying: “We’ve always agreed that healthy, thriving markets are in everyone’s interest.

“We’ve already made a wide range of changes to our products to address the Commission’s concerns. Over the next few months, we’ll be making further updates to give more visibility to rivals in Europe.”

The fine is the third competition breach penalty the tech giant has been issued with by the European Commission.

Last year it was fined a record £3.9 billion fine over restrictions placed on mobile phone manufacturers using Android to drive internet traffic to Google’s own search engine.

In response, Google said it would begin asking Android users in Europe about their preferred search engine and web browser apps.

In 2017, Google was also ordered to pay more than £2 billion over competition breaches linked to the firm’s online shopping comparison service.