Google fined record €2.4bn by European Union for search 'abuse'

Fine Margrethe Vestager

The commission found out that it has given prominent placement to Google Product Search in its search engine and has demoted rival comparison shopping services in its search results.

It has been observed that when Google search engines were used by customers for clothes or electronic products, the website results significantly showed company's own pricing comparison and thereby degrading rivals.

European Competition Commissioner Margrethe Vestager holds a news conference at the EU Commission's headquarters in Brussels, Belgium on June 27, 2017.

The penalty has surpassed the previous 1.1 billion euros record fine Intel was forced to pay in 2009 and the European Union might also demand that Google make changes to its search results so that it was not seen to favour its own service, telegraph.co.uk reported. European Union says that if the current conduct is not altered, Google will face daily penalties of up to five percent of its average daily turnover.

Google issued a statement saying it respectfully disagrees with the decision and it is considering an appeal.

Vestager was quoted as saying, "Google has come up with many innovative products and services that have made a difference to our lives". That's a good thing. Google has included a number of criteria in these algorithms, as a result of which rival comparison shopping services are demoted. Instead, Google abused its market dominance and promoted its own services, Vestager emphasised.

If Google fails to act, the Commission has said it will fine Google's parent company Alphabet five per cent of its average daily worldwide earnings.

The investigation found that when Google launched online shopping comparison platform Froogle, now known as Google Shopping, in 2004, it struggled to compete with established rivals.

The company will review the decision and consider an appeal. The amount, €2.42 billion, is the highest ever imposed by the Commission.

The European Commission said that the search engine has 90 days to end the misconduct.

Walker said the search results displayed by the company are "the result of hard work and constant innovation, based on user feedback". Additionally, there were many exchanges with customers and competitors, and some of them, some USA companies, were involved as complainants, the Commission claimed. "And advertisers want to promote those same products", the company statement said.

"We think our current shopping results are useful and are a much-improved version of the text-only ads we showed a decade ago".

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