Online advertising: Google wins its legal action against the European Union

The decision can still be appealed to the Court of Justice of the EU, the Union's highest court, but only on points of law.

Google on Wednesday won a legal challenge to a €1.49 billion antitrust fine imposed by the European Union. five years ago, which targeted its online advertising business.

The General Court of the European Union has announced that it is annulling the penalty imposed in 2019 by the European Commission, the main body monitoring the application of antitrust rules in the 27-nation Union.

“The Court annuls the Commission's decision in its entirety”the court said in a press release.

Exclusivity clauses targeted by the European Commission

The Commission's decision specifically concerned ads that the US tech giant sold alongside Google search results on third-party websites.

European regulators accused the American company of including in its contracts exclusivity clauses that prohibited these sites from serving similar ads sold by Google's rivals.

The Commission stated when imposing the sanction that Google's conduct had the effect of reduce choice for advertisers and website owners and expose them to higher costs, which would be passed on to consumers.

But the Court states that The Commission has “made mistakes” when evaluating these clauses.

The Commission failed to demonstrate that Google's contracts discouraged innovation, harmed consumers or helped the company maintain and strengthen its dominant position in national online advertising markets, the Court said.

The judgment can still be appealed to the Court of Justice of the European Union.the highest court in the Union, but only on questions of law.

The European Commission said in a brief statement that it “carefully study the judgment and consider possible next steps”.

Fines totalling 8 billion euros

Google claims to have amended its contracts in 2016 to remove the provisions in questioneven before the Commission imposed its decision.

“We are pleased that the court has recognised the errors in the original decision and overturned the fine”the American company said in a statement. “We will carefully review the entire decision”.

The company's legal victory comes a week after it lost a final appeal against another EU antitrust case over its shopping comparison servicewhich also resulted in a heavy fine.

The sanctions are part of three antitrust fines totalling around €8 billion that the Commission has imposed on Google over the past decade. The sanctions marked the beginning of an era of intensified scrutiny of big tech companies.

Google accused of abusing its dominant position

Since then, Google has faced increasing pressure from both sides of the Atlantic over its digital advertising policies.

The company is currently engaged in litigation against the Justice Department in U.S. federal court over allegations that its dominance over technology constitutes an illegal monopoly.

This month, British competition regulators also accused the company of abusing its dominant position in the country's digital advertising market by giving preference to its own services.

Last year, European Union antitrust authorities, which are conducting their own investigation, suggested that breaking up the company was the only way to resolve competition concerns over its digital advertising business.