Google lands record £2.1bn fine for competition breaches

'What Google has done is illegal under EU antitrust rules,' said  EU watchdog
'What Google has done is illegal under EU antitrust rules,' said EU watchdog

Google has been slapped with a record fine of k2.42 billion (£2.1bn) by Europe’s competition watchdog after breaching antitrust rules with its online shopping service.

The European Commission has told the internet search giant that it now has 90 days to stop the practice or face a penalty of up to 5% of the average daily turnover of the firm’s parent company, Alphabet.

However, Google said it was considering launching an appeal against the commission once it had reviewed the decision.

The penalty comes after the competition referee launched an investigation into Google Shopping seven years ago, amid complaints it gave the service a prominent position on the internet search engine, while rival services were demoted.

In a statement, commissioner Margrethe Vestager said: “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.”

The watchdog said Google was the most dominant search engine across the 31 countries in the European Economic Area (EEA).

It found that Google had handed its comparison shopping service an illegal advantage in 13 EEA countries, including in the UK and Germany where it was launched in 2008.

The abuse caused traffic to Google’s shopping service to jump 45-fold in the UK, 35-fold in Germany and 19-fold in France.

However, the demotions to rival websites triggered sharp reduction in traffic, with some UK sites seeing visitor numbers plunge 85%.

Ms Vestager added: “What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate.

“We respectfully disagree with the conclusions announced today.

“We will review the commission’s decision in detail as we consider an appeal, and we look forward to continuing to make our case.”