Who Has Hit Google With A Fine?
The Directorate-General for Competition (DG Comp) has hit Google with a fine. DG Comp is essentially a department of the EU civil service. They operate through a complex series of departments (you can see a structure chart- here). However, they are headed by a Director-General and his boss is a political appointee – the Commissioner named Margrethe Vestager. She is Danish, and her position gives her considerable power.
What Does DG Comp Do?
DG Comp says “Competition policy is about applying rules to make sure companies compete fairly with each other. This encourages enterprise and efficiency, creates a wider choice for consumers and helps reduce prices and improve quality.”
DG Comp create and enforce policy by having meetings, making decisions, and documenting them. Their document output is vast. Just how many people are engaged in this endeavour I have not been able to find out, however the totality of the EU civil service is 32,000 or so. So, I would guess they employ 4 or 5,000 people.
They say “The Commission pursues an effective enforcement of competition rules in the areas of antitrust and cartels, mergers and state aid, maintaining competition instruments aligned with market developments, as well as promoting a competition culture in the EU and world-wide. The Commission follows an economic as well as a legal approach to the assessment of competition issues.
The Commission has the power not only to investigate but also to take binding decisions and impose substantial fines. The Commission enforces the EU competition rules together with the competition authorities of the EU countries.
The Commission investigates whether companies are violating or could potentially violate the competition rules. This means it can act either before or after the rules are broken, in order to safeguard a competitive market. As a result of the Commission’s investigations, it can decide to prohibit a certain conduct, require remedial action or impose a fine, depending on the situation”
So Do They Document The Google Case?
They document everything. In the Google case buried away in the papers they announced in 2015 they said:
“The Commission intends to investigate whether Google has illegitimately hindered the development and market access of rival mobile operating systems, applications or services for smartphones and tablets. The initiation of proceedings does not signify that the Commission has made a definitive finding of an infringement but merely signifies that the Commission will deal with the case as a matter of priority.”
One does wonder what would have happened if it had not been a priority.
Is This Political?
Magrethes Vestager’s high-profile cases and eye catching fines have helped establish her as the superstar of the Commission, but she prevaricates her real ambitions are.
Many in Brussels see her as a great candidate to succeed Jean-Claude Juncker as Commission president, but there are any obstacles in her way. Not least because she is not well favoured by some in Denmark and she is not from the ruling party.
What Else Has DG Comp Done?
The $5 billion fine dwarfs Google’s previous $2.7 billion record-breaking fine from the EU last year over manipulated search results. Google is still appealing that particular judgment in a back-and-forth that’s expected to last years. Facebook, Intel, and Microsoft have all faced significant anti-competition fines from the European Commission. Microsoft was famously fined twice by the EU after the software maker failed to include a browser ballot in a Windows 7 update. Apple was also ordered to pay back $15.4 billion in taxes to the European Union.
What Happens Now?
The EU has now ordered Google to adhere to its judgment within 90 days and unbundle search and Chrome from its Android offering. With Google appealing the decision, the legal process is likely to run for many years ahead.
If the money is eventually paid to the EU it will be divided up amongst the members of the EU. Presumably by that point we will not benefit in the UK.
Magrethes Vestager’s career will no doubt go from strength to strength.