Google Accuses EU of Overreach With €2.4 Billion Shopping Service Abuse Fine

The Alphabet Inc. unit is appealing a 2021 ruling by the EU’s lower tribunal that backed the European Commission’s decision that the firm violated antitrust rules by favoring its own shopping service over those of its rivals.

Earlier, Google argued that it couldn’t be expected to treat its competitors the same as it does its own businesses. (AP)

The European Union's legal team hit back at Google's fight to strike out a €2.4 billion ($2.6 billion) fine for unfairly favoring its own shopping services — telling judges at the bloc's top court that the case largely boils down to whom they should trust more.

The Alphabet Inc. unit is appealing a 2021 ruling by the EU's lower tribunal that backed the European Commission's decision that the firm violated antitrust rules by favoring its own shopping service over those of its rivals. It was forced to change the way it displays shopping search results that might help rivals grab some of the valuable ad space on search pages.

But ending an in-the-weeds debate about what legal test should have been correct in this case and the Brussels-based commission's understanding of what competition is, Fernando Castillo de la Torre, lawyer for the regulator, reminded the court that it's been enforcing competition law for decades.

“You have to decide if you want to trust the enforcement of competition to Google or the commission,” he told the hearing at the EU's Court of Justice. “Google's conduct in this case paid off” and “transformed the fortunes of its own service,” while “the fortunes of rival services took a diametrically opposed turn,” he told the court.

Earlier, Google argued that it couldn't be expected to treat its competitors the same as it does its own businesses. The 2017 penalty — then a record for the bloc's antitrust watchdog — was the first in a series of high profile cases where the commission sought to crackdown on the dominance of Silicon Valley firms in the region.

“Companies do not compete by treating competitors equally with themselves,” said Thomas Graf, a lawyer for Google. “The whole point of competition is for a company to differentiate itself from rivals. Not to align with rivals so that all are the same.”

The EU's shopping fine formed part of a trio of decisions that set the tone of EU Competition Commissioner Margrethe Vestager's bid split up the power of a handful of firms including Apple Inc. and Meta Platforms Inc.'s Facebook. Vestager's team has fined Google €8.3 billion in total, including for abuses of its dominance on its mobile operating system and its display advertising operations, all of which the company is appealing.

Vestager is currently on leave from the top antitrust job as she seeks the presidency of the European Investment Bank.

Google's legal battle comes on top of a pending EU probe into the company's suspected stranglehold over digital advertising with the risk of another order for remedies and ahead of a potential new clampdown under the bloc's digital markets rules which will equip regulators with new powers and which could force significant changes from tech companies in how they do business in the bloc.

The next step in Tuesday's case will be a non-binding opinion from one of the top court's advisers on Jan. 11.