EU slams Google with $3.2 billion fine over claims of rigged ad market

BRUSSELS (CN) — European regulators hit Google with a €2.95 billion ($3.2 billion) fine Friday over accusations the company abused its dominance in digital advertising technology, marking the latest clash between U.S. tech giants and European authorities.

The European Commission accused the California-based company of distorting competition in online advertising by systematically favoring its own services over rivals, harming competitors, advertisers and publishers across the bloc.

European officials said Google’s control over multiple layers of the digital advertising ecosystem creates fundamental conflicts of interest. The company operates software used by both advertisers seeking to place ads and publishers looking to sell advertising space on their websites.

“Google must now come forward with a serious remedy to address its conflicts of interest, and if it fails to do so, we will not hesitate to impose strong remedies,” European Commission Executive Vice President Teresa Ribera said in a statement

Ribera went further, framing the issue in broader terms: “Digital markets exist to serve people and must be grounded in trust and fairness. When markets fail, public institutions must act to prevent dominant players from abusing their power.”

She added that “true freedom means a level playing field, where everyone competes on equal terms and citizens have a genuine right to choose.”

In return, Google said Friday it would appeal the decision.

“The European Commission’s decision about our ad tech services is wrong and we will appeal. It imposes an unjustified fine and requires changes that will hurt thousands of European businesses by making it harder for them to make money,” Lee-Anne Mulholland, Google’s vice president and global head of regulatory affairs, said in a statement.

Google has 60 days to propose how it will address the outlined violations and resolve what regulators call inherent conflicts in its business model. The company faces a deadline in early November to submit its response.

The commission indicated it could force Google to sell off parts of its advertising technology business if the company’s proposed remedies prove insufficient. European officials said they would first review Google’s proposal before considering structural changes to the tech giant’s operations.

The fine represents the latest escalation in Europe’s regulatory crackdown on major American technology companies. The EU executive previously issued preliminary charges against Google in 2023, suggesting that forcing the company to divest portions of its advertising technology operations might be necessary to restore fair competition.

The decision represents a dramatic reversal from earlier this week, when EU Trade Commissioner Maroš Šefčovič blocked the planned Google penalty over concerns it would harm EU-U.S. trade relations amid threats from President Donald Trump targeting countries with digital regulations.

Šefčovič said earlier this week that the commission’s internal procedures “existed for a reason.” The intervention sparked fierce criticism from European lawmakers who accused the executive body of bowing to U.S. pressure.

The Google case has become a flashpoint in growing European resistance to Trump’s July trade deal with the EU. In late August, Trump warned on Truth Social that countries with “Digital Services Legislation and Digital Markets Regulations” would face “substantial additional Tariffs” and restrictions on technology transfers.

Reports indicate that Ribera, who leads the commission’s competition enforcement, has emerged as a key figure challenging institutional accommodation to Trump’s threats.

Meanwhile, Google faces parallel legal challenges in the United States involving both its search and advertising businesses.

In April, a federal judge ruled that Google illegally monopolized parts of the advertising market, with a remedies hearing scheduled to begin Sept. 22. Separately, in a case focused on Google’s search monopoly, a federal judge ruled this week that the company must end exclusive search deals but will not be forced to sell Chrome or Android.

European officials specifically noted that their findings align with those of U.S. prosecutors, potentially setting up coordinated enforcement actions.

This latest penalty adds to Google’s substantial regulatory costs in Europe. Since 2017, the company has faced over 9.5 billion euros ($10.5 billion) in EU fines, including 2.4 billion euros for favoring its shopping service, 4.3 billion euros for Android restrictions, and 1.5 billion euros for advertising practices, though the last penalty was subsequently overturned.

However, this case represents a potential shift in regulatory strategy. Rather than simply imposing financial penalties that Google can afford to pay, European authorities are seriously considering structural remedies that would fundamentally alter how the company operates its advertising business globally.

Courthouse News correspondent Yuval Molina Obedman is based in Brussels, Belgium.