The reasons for the decision to annul the fine against the technology giant were that the Commission did not demonstrate that this practice, on the one hand, discouraged innovation, helped Google “maintain and strengthen its dominant position in online advertising markets and, lastly, that it had harmed consumers”.
In its defence, the company pointed out that this case only concerned a small subset of text search ads placed on a limited number of websites, so the impact was not as high as the European Commission had claimed.
The illegal practices, according to the lawsuit, occurred between 2006 and 2016, but a company spokesperson said that in 2016, the company had modified its contracts to eliminate clauses that could be considered anticompetitive, even before the case began.
It should be noted that the case has not yet reached its final point, as the Commission still has the possibility of appealing the decision and continuing through the Court of Justice of the European Union.
If that were to happen, it would be a major blow to Google, which was fined $2.65 billion last week for abusing its dominant position and favoring its own comparison shopping service.
Although this decision is a defeat for the EU, it shows that the bloc is one of the most critical bodies of big technology companies. Last week, for example, it imposed a fine of 14.4 billion dollars on Apple.
The decision arose from a 2016 ruling by the European Commission that accused Ireland of giving Apple illegal tax benefits. The case revolved around Ireland’s old tax regime, known as the “Double Irish” scheme, which allowed multinationals like Apple to drastically reduce their tax liabilities.
The European Commission concluded that the Cupertino company benefited from two tax rulings in Ireland between 1991 and 2007 that artificially reduced its tax rate, reaching 0.005% in 2014.
The arrangement allowed Apple to avoid billions in taxes by channelling profits through subsidiaries in Ireland but taxed elsewhere. The regulator deemed this illegal state aid that distorted competition in the EU.
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