The Google logo is displayed on the smartphone screen and the European flag on the computer screen.
Nicholas Koukoufilis | Noor Photo | Getty Images
The European Union's second-highest court said on Wednesday that a fine of 1.5 billion euros ($1.7 billion) had been imposed on Google The ruling by regulators should be overturned, and the US tech giant should be sided with after it appealed the ruling.
The case dates back to 2019 when the European Commission, the EU's executive arm, said, alphabetGoogle abused its market dominance with a product called AdSense for search. This product allowed website owners to display ads in search results on their own pages.
Google acts as an intermediary that allows advertisers to serve search ads on third-party sites.
But the Commission alleged that Google abused its market dominance by imposing a number of restrictive clauses in contracts with third-party sites, which ultimately prevented competitors from placing their search ads on these sites.
At the time, the Commission fined Google €1.49 billion. Google appealed the ruling and took the case to the General Court of the European Union.
The EU's General Court said on Wednesday it “upholds the majority of the findings” but “annuls the decision under which the Commission imposed a fine” of around €1.5 billion.
The court added that the commission “failed to take into account all relevant circumstances in its assessment of the duration of the contract terms” that it deemed abusive.
A Google spokesperson told CNBC that the company will review the full decision closely.
“This case concerns a very narrow subset of text-only search ads published on a limited number of publisher sites. We made changes to our contracts in 2016 to remove the relevant provisions, even before the Commission’s decision. We are pleased that the court has acknowledged the errors in the original decision and overturned the fine,” a Commission spokesperson said.
A spokesperson for the commission said it had taken note of the ruling and would consider possible next steps. Google was not immediately available for comment when contacted by CNBC.
The Commission can appeal this decision, which could take it to the European Court of Justice, the EU's highest court.
There has been a series of court cases involving EU and US tech companies that have recently reached their conclusions.
This month, the European Court of Justice upheld a €2.4 billion ($2.65 billion) fine it imposed on Google for abusing its dominant position by favoring its own shopping comparison service. The same court also ordered Apple to pay €13 billion in back taxes to Ireland, ending a decade-long case.
