Brussels fines Google €3 billion, and Trump threatens retaliation
The European Commission accuses the technology company of violating antitrust laws in the advertising market and asks it to sell part of its business.
BrusselsBrussels is going straight. Despite Donald Trump's threatsThe European Commission announced this Friday that it will fine Google €2.95 billion. According to some media reports, the EU executive had postponed this decision for fear of retaliation from the US president, who has yet to lower tariffs to the 15% rate agreed with the European Union. In the end, the European Commission will apply its regulations anyway and punish the US tech giant for violating EU competition and antitrust laws. Just hours after the fine was made public, as the day was just beginning in the United States, Trump's dreaded response arrived. In a post on his Truth Social network, the president criticized Brussels and threatened retaliation: "I will be forced to initiate proceedings to overturn the unjust sanctions," he said, after stating that the fine "is an injustice that the American taxpayer will not tolerate."
The procedure Trump is threatening involves opening an investigation to determine whether a foreign government or governments are engaging in trade practices that harm the US economy. If this is deemed to be the case, the door is open to the imposition of additional tariffs.
The EU executive accuses Google of distorting free competition by favoring its own advertising technology management services over other providers that offer the same services. Thus, Brussels orders the US company to put an end to these practices that seek to favor its own products and to implement measures to end the conflict of interest it faces throughout the online advertising supply chain.
In fact, Brussels primarily denounces the fact that Google controls the entire value chain of online advertising technology management. For this reason, it believes one of the most viable solutions is for the big tech company to sell off part of that business.
The European Commission is now giving the US tech giant sixty days to respond and report on what measures it plans to take to address the illegalities Brussels accuses it of. Google, on the other hand, could also take this financial penalty to the European courts. On several occasions when the EU executive has imposed this type of sanction on US tech giants, both sides have ended up in court.
Despite the fact that the postponement of the fine announcement raised a lot of controversy, the European Commission avoided holding a press conference this Friday to explain the case, as is customary. Instead, it limited itself to sending a statement from the vice president of the EU executive and head of Competition, the Spanish socialist Teresa Ribera, in which she defended Brussels' decision against the tech giant. "Google's attitude violates the European Union's antitrust rules. It must present serious solutions to address its conflicts of interest, and if it fails, we will not hesitate to impose strong solutions," Ribera said in a statement.
One of Brussels' highest fines.
Despite the tensions between the European Union and the United States, the European Commission has not backed down and has imposed one of the largest antitrust fines in its history. However, it is not the largest Brussels has imposed on the tech giant. In 2018, it imposed a €4 billion fine against Google Android. Previously, it had also fined Google Shopping €2.4 billion. In fact, according to EU sources, the European Commission has increased the final amount of the financial penalty announced this Tuesday by 60% for repeated violations of EU law.
This Friday's fine represents around 0.9% of the US company's annual international turnover, a much higher percentage than what is typically associated with other antitrust fines, according to EU sources. For example, the latest financial penalty imposed on Apple Music was €1.8 billion, representing 0.51% of its global turnover, and on Facebook Market Place, €797 million, representing around 0.65%.
In this way, Brussels has ignored Trump's threats to attack all those administrations that regulate large US technology companies, which make huge profits in the European Union. "I am warning countries with taxes or digital laws that if they do not eliminate them, I will impose additional tariffs on their exports or impose restrictions on the export of our technology," said the US president. However, the US justice system has also fined Google several times for abusing its dominant position in the online advertising market.