European Union vs. Google

European Union vs. Google is an investigation and enforcement action by the European Commission against Google for alleged unfair competition. The investigation against Google started on 15 April 2015, after Margrethe Vestager, European Commissioner for Competition, accused Google of using Android OS to promote its mobile services.

EU's claims

On April 15, 2015, the European Commission started an official investigation against Google. The Commission released its Statement of Objections to Google^[1] – a formal claim against the company's actions in the market of mobile devices, and accused the company of abusing its dominant position by means of Android. Having recalled that about 80% of smart phones and tablet PCs sold in EU run on Android, the European Commission stated numerous complaints from the companies creating mobile apps based on this platform. After conducting its own investigation that lasted for a year, the Commission initiated a court trial to clarify the following:

1. Whether Google actions impede development of the market of mobile devices and access of competitors thereto by demanding or encouraging smart phone manufacturers to pre-install Google apps and services on their devices.
2. Whether Google suppressed attempts of smart phone and tablet PC manufacturers willing to install Google apps on their devices to run on modified and potentially competitive versions of Android.
3. Whether Google unlawfully impeded the market development by way of tacking the installation of certain Google apps with the use of other apps of this company or its software interface.

A year after, on April 20, 2016, the European Commission announced the issue of the second Statement of Objections to Google and Alphabet Inc., the consortium Google is a part of,^[2] which concerned Google Search engine being imposed, in the Commission's opinion, by the company to the manufacturers of mobile devices along with Google Chrome browser along with the direct prohibition for the manufacturers of mobile devices to pre-install other browsers. Those restrictions were set in Mobile Applications Distribution Agreements (MADA). The European Commission emphasized that about 80% of smart phones sold in the European market use Android, and with its actions, Google violates the antitrust law. Margrethe Vestager, European Commissioner for Competition, said:^[3]

A competitive mobile internet sector is increasingly important for consumers and businesses in Europe. Based on our investigation thus far, we believe that Google's behavior denies consumers a wider choice of mobile apps and services and stands in the way of innovation by other players, in breach of EU antitrust rules. These rules apply to all companies active in Europe. Google now has the opportunity to reply to the Commission's concerns.

In their Statement of Objections, the European Commission accused Google of the breach of EU antitrust rules in three ways:

• by requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
• by preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
• by giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.

In both cases, the antitrust body gave Google 12 weeks to reply. The damage inflicted by the company's actions was estimated by the European Commission at 10% of the company's annual revenue, which amounts to $7.4 billion.^[4]

On July 12, Ricardo Cardoso, EC Spokesperson, said that the company asked the Commission for additional time to study the violations data, and received consent. As Mr. Cardoso said, the meeting on merits is to be held on September 7.^[5]

See also

• Russia antitrust case
• Microsoft Corp v Commission

References