Antitrust

S H E A R M A N & S T E R L I N G L L P | 9 9 effectively to an end." 4 With no further indication as to what it should do, it was left to Google to devise a satisfactory remedy. If it failed to do so, the EC reserved the right to impose "a daily periodic penalty payment of 5% of Alphabet's average daily turnover in the business year preceding such a failure to comply." 5 The EC decision further stated that whatever remedial measures Google chose to adopt must: "(a) apply to all devices, irrespective of the type of device on which the search is performed; (b) apply to all users of Google situated in the thirteen EEA countries in which the Conduct takes place […]; (c) subject Google's own comparison shopping service to the same underlying processes and methods for the positioning and display in Google's general search results pages as those used for competing comparison shopping services […], (d) not lead to competing comparison shopping services being charged a fee or another form of consideration that has the same or an equivalent object or effect as the infringement established by this Decision." 6 Therefore it was up to Google to craft effective remedies that would put an end to its illegal conduct. The looseness of the Google Shopping decision in relation to the remedies Google must implement is surprising given the various commitment packages Google submitted to the EC over the course of the 7 years that the EC investigation was ongoing. Rather than setting out a detailed remedy package, in its final decision the EC limited itself to the statement of principle that it expected Google to "compl[y] with the simple principle of giving equal treatment to rival comparison shopping services and its own service." 7 Commissioner Vestager explained that "It is Google's sole responsibility to ensure compliance and it is for Google to explain how it intends to do so." 8 Google devised the following remedy: everybody can bid for ad placements in Google's Shopping search engine without having a specific slot reserved for Google Shopping or other comparison shopping services. Users can also choose whether the shopping service shows links to comparison shopping sites or directly to sites where merchants and products are available. Commissioner Vestager described these developments as "positive" in March 2019, though she noted that the EC would continue to monitor the market. 9 Other EC officials have also welcomed the changes; Nicholas Banasevic, Head of Unit at EC's Directorate General for Competition, who led the investigation, stated that Google's changes were "an example of engagement where we see the remedy working." 10 However, doubts as to the effectiveness of the remedy remain. Rivals of Google have argued that the changes do not give sufficient prominence or detail to rival search results. 11 The consumer protection association BEUC has also expressed concerns; in April 2019, it wrote to Commissioner Vestager challenging what it describes as "signals" displayed by the EC that Google's changes are compliant with the decision. 12 1. European Commission Decision of June 27, 2017 in Case AT.39740 Google Search (Shopping). Google lodged an action for annulment against the decision before the European General Court on September 11, 2017 in Case T-612/17 Google and Alphabet v. Commission. 2. EC Press Release "Antitrust: Commission seeks feedback on commitments offered by Google to address competition concerns" April 25, 2013. The EC considered in its preliminary conclusion that Google could have abused its dominant position by (i) favoring within Google's general search engine Google's specialized web search services; (ii) using original content from third party web sites without consent; (iii) concluding agreements with publishers which obliged them to obtain all or most of their online search advertisements from Google; and (iv) by including restrictive clauses on the transferability of online search advertising campaigns and the management of such campaigns across Google's AdWords and rival search advertising platforms. 3. EC Fact-sheet "Antitrust: Commission sends Statement of Objections to Google on comparison shopping service," April 15, 2015. 4. Case AT.39740 Google Search (Shopping) [701]. 5. EC Press Release "Antitrust: Commission fines Google €2.42 billion for abusing dominance as search engine by giving illegal advantage to own comparison shopping service," June 27, 2017. 6. Case AT.39740 Google Search (Shopping) [700]. 7. Statement by Commissioner Vestager on Commission decision to fine Google €2.42 billion for abusing dominance as search engine by giving illegal advantage to own comparison shopping service, June 27, 2017. 8. Ibid. 9. Statement by Commissioner Vestager on Commission decision to fine Google €1.49 billion for abusive practices in online advertising, March 20, 2019. 10. American Bar Association Antitrust Section Spring Meeting 2019, Washington DC, March 27–29, 2019. Write-up available at: http:// www.mlex.com/GlobalAntitrust/DetailView. aspx?cid=1078254&siteid=190&rdir=1. 11. See, for example, "Google's shopping changes don't remedy EU abuse, Kelkoo says," April 3, 2019, available at: http:// www.mlex.com/GlobalAntitrust/DetailView. aspx?cid=1080234&siteid=190&rdir=1 and "Google rivals: Search giant's antitrust fix worse than Almunia's settlement," February 28, 2018, available at: https://www.politico.eu/article/Google- rivals-vestagers-solution-worse-than-almunias/. 12. "Consumer concerns with Google's non-compliant remedy in Antitrust Shopping case," April 5, 2019, available at: https://www.beuc.eu/publications/ beuc-x-2019-020_google_non-compliant_ remedy_in_antitrust_shopping_case.pdf. 13. "Comment: Google jobs-search scrutiny sees EU revisit questions of web-traffic diversion," March 1, 2019, available at: http:// www.mlex.com/GlobalAntitrust/DetailView. aspx?cid=1070296&siteid=190&rdir=1. 14. European Commission Decision of March 20, 2019 in Case AT. 40411 Google Search (AdSense). 15. "Comment: Google jobs-search scrutiny sees EU revisit questions of web-traffic diversion," March 1, 2019, available at: http:// www.mlex.com/GlobalAntitrust/DetailView. aspx?cid=1070296&siteid=190&rdir=1. WHAT WILL HAPPEN NEXT? Although the EC considers that Google is on the right track, continued full compliance with the decision will be necessary or it will face another fine. Indeed, companies have been fined for failure to adequately implement remedies. In 2013, Microsoft was fined €561 million for non-compliance with commitments it had offered in 2009 to address the EC's concerns in relation to the tying of its web browser, Internet Explorer, to its PC operating system, Windows. Nor did Google's woes end with the Google Shopping case. In 2018, Google faced a second EC decision imposing a fine of €4.34 billion, in the Google Android case 13 (at the time of writing of this article, the decision is not yet public) and in 2019 a third decision imposing a fine of €1.49 billion in the Google Search (Ad Sense) 14 — though it is unlikely that there will be compliance issues in that case, as the EC found that the infringement had ended in 2016. Additionally, March 2019 also saw reports of EC interest in the Google for Jobs search tool following a complaint in 2018, with criticisms of the tool including, again, the facts that Google allegedly favors its own results over those of rivals. 15

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