EU slaps $1 billion fine on Google for violating digital competition rules

New Delhi: The European Commission on Thursday fined Google a combined 890 million euros ($1 billion) for violating the bloc’s digital competition rules, with regulators accusing the technology giant of favouring its own services and restricting competition in its app ecosystem.

The European Commission, the EU’s executive arm, imposed a 460 million euros penalty over Google’s search-related practices and another 430-million euro fine linked to its Google Play app store rules.

Google is required to comply with the Commission’s decisions within 60 days, otherwise it risks periodic penalty payments of up to 5 per cent of its total worldwide turnover.

The Commission said in a statement that it found that Google gives preferential treatment to its own services, including shopping, hotels, transport and sports results, over those of third parties in Google Search, thereby breaching its obligations under the DMA.

“Google has fallen short of effective compliance with the Digital Markets Act, and today we have taken decisive yet balanced enforcement action sanctioning these breaches. The best products should succeed because they’re better, not because they’re owned by the company running the search engine,” said Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition.

Under the DMA, app developers that distribute their apps via Google Play should be able to inform customers – free of charge – of alternative, often cheaper, offers, and to direct them to those offers to make purchases, for example on websites or alternative app stores.

The Commission found that Google failed to comply with that obligation.

“In particular, Google prevents app developers from freely communicating and promoting offers and concluding contracts with users in distribution channels of their choice, including third-party app stores,” the statement said.

The Commission has ordered Google to bring the non-compliance to an end.

Google must implement measures to treat third-party services that feature on Google’s search results in a fair and non-discriminatory manner by reference to its own services and allow app developers distributing their apps via Google Play Store, both technically and contractually, to freely communicate, promote offers and conclude contracts with users not only within but also outside the Google Play app store, said the Commission.

IANS