(Brussels) Antitrust authorities in the European Union (EU) have taken on Google’s lucrative digital advertising business in an unprecedented ruling ordering the tech giant to divest part of its advertising business to address concerns in terms of competition.
The European Commission, the European Union’s executive arm and chief enforcer of antitrust law, has said that after an investigation it believes that “only Google’s compulsory divestiture of part of its services” would address the concerns expressed.
The European Union, which has 27 member states, has taken the lead in the global crackdown on big tech companies, but has so far been content with handing out colossal fines, including three antitrust fines worth of several billion euros to Google.
It is the first time that the European Union has ordered a tech giant to spin off some of its businesses.
Google can now defend itself by presenting its arguments before the Commission makes its final decision. The company did not immediately respond to a request for comment.
The Commission’s decision stems from a formal investigation it opened in June 2021, into whether Google breached EU competition rules by favoring its own online display advertising technology services over from rival publishers, advertisers and ad technology services.
The Commission’s investigation focused in particular on YouTube, to determine whether Google was using the dominant position of the video-sharing site to favor its own ad-buying services by imposing restrictions on rivals.
Google’s ad tech activities are also under investigation by the UK antitrust watchdog and are the subject of legal proceedings in the United States.
Brussels has already imposed fines on Google worth more than 8 billion euros (currently 11.5 billion) in three separate antitrust cases, relating to its Android mobile operating system and its shopping and search services of advertising.
The company is appealing these three sanctions. Last year, an EU court slightly reduced Android’s fine to €4.125 million ($5.9 billion). EU regulators have the power to impose penalties of up to 10% of a company’s annual turnover.