The European Commission sent another round of Statements of Objections to Google on 14 July 2016.
A Statement of Objections constitutes a formal step in a Commission investigation into potential violations of EU antitrust rules, informing the undertakings being investigated of the objections raised against them. The undertakings concerned can access the Commission’s file and formulate a response to the allegations, both written and oral, on request. Also, the complainants and third parties with sufficient interest can share their views.
If the Commission does render a decision, Google risks fines of up to 10% of its global turnover. Settlement discussions between the Commission and Google have been unsuccessful, with a third package of commitments rejected by the Commission in 2014.
The recent Statements of Objections concern two types of alleged anti-competitive behaviour, with each of them being investigated separately.
First, a supplementary Statement of Objections has been issued regarding Google’s shopping comparison tool, alleging that Google has abused its dominant market position for general internet search services within the EEA by favouring, in a systematic manner, “Google shopping” in its general search results pages. Among others, “Google shopping” is displayed prominently on the Google search results page, regardless of the relevance of the result. According to the Commission, Google should treat its own shopping comparison service and those of rivals in the same way.
Last year, the European Commission had already issued a Statement of Objections regarding these practices. The competition watchdog has now supplemented its preliminary conclusions. Further investigative measures resulted in additional evidence in support of the Commission’s allegations and relate to the impact of a website’s prominence of display on its traffic, as well as the movement of traffic to Google's comparison shopping service compared with its competitors. The supplementary Statement of Objections should refute Google’s claim that the relevant market is much broader with eBay and Amazon competing in a market of shopping comparison services. Google and its parent Alphabet have eight weeks to respond.
Secondly, Competition Commissioner Vestager targets Google’s advertising business, which represents the company’s most important source of income. The Commission issued a Statement of Objections regarding “AdSense”, a platform for search advertising mediation. Google not only places advertisements on its search website, but also acts as an intermediary and places ads on third party websites which incorporate the Google search functionality. In this market for search advertising mediation, the Commission considers that Google has a dominant position. By agreeing on exclusionary clauses regarding exclusivity (or equivalent), premium placement for Google search ads and a right to approve competing search ads with its main partners, Google may have abused its dominant position. Google and Alphabet have 10 weeks to respond.
The Commission declared it will “continue to investigate the favourable treatment by Google in its general search results of its other specialised search services, and concerns with regard to copying of rivals’ web content (known as 'scraping'), and undue restrictions on advertisers” (press release IP/16/2532, 14 July 2016).
Earlier this year, another Statement of Objections was issued regarding Google’s alleged abuse of its dominant position by imposing restrictions on Android device manufacturers and mobile network operators, bringing the current number of charges to three.
Kim Gillade
Associate, Brussels
kim.gillade@cms-db.com
Annabelle Lepièce
Partner, Brussels
annabelle.lepiece@cms-db.com
