LUXEMBOURG (CN) - Google's Android business model faced a major legal setback Thursday as a top EU court adviser backed a multi-billion-dollar fine, saying the company exploited its mobile ecosystem to illegally cement dominance in general search.
In a long-awaited opinion, Advocate General Juliane Kokott recommended that the European Court of Justice uphold the European Commission's 2018 decision, which imposed a 4.124 billion ($4.73 billion) fine on Google for anticompetitive behavior.
Referring to the conduct as a "single and continuous infringement" of EU competition law, Kokott rejected the idea that tying Google Search and Chrome to Play Store access was legitimate integration, supporting the EU's view that the contractual terms formed part of a broader strategy to shut out rivals and entrench dominance across markets.
The opinion reinforces a key legal principle in EU competition law: Authorities must show how product bundling can shut out rivals, rather than proving actual exclusion.
"The case is critical in confirming that it rests upon enforcers to explain and substantiate how the bundling of products can foreclose competitors," said Christian Bergqvist, a professor of competition law at the University of Copenhagen.
The dispute dates back to a 2013 complaint and culminated in the European Commission's 2018 decision to fine Google 4.124 billion after finding that requiring the pre-installation of Search and Chrome in exchange for Play Store access gave Google an unfair advantage. The commission is the EU's main executive body.
Android was installed on 80% of mobile phone devices in the European Union when the fine was issued. Though the commission said Google had paid phone makers like Samsung and HTC to preload Google Search directly onto their devices, Google's lawyers attributed the widespread use of Android to the supposed superiority of the product.
While Google has argued that Android's open-source nature fosters competition, the commission concluded that its contractual practices, such as requiring the pre-installation, limited user choice and stifled innovation. The General Court largely upheld this view in 2022, slightly reducing the fine after excluding certain revenue-sharing agreements.
In its appeal to the Court of Justice, Google claimed that tying in its apps improved user experience. But Kokott rejected that defense, stressing that "the pre-installation of an app in itself confers an advantage over competing apps," reinforcing a status quo bias that steers user behavior and entrenches dominance in general search.
Although the General Court annulled in 2022 the commission's finding of abuse regarding portfolio-based revenue share agreements, Kokott found those agreements reinforced Google's strategy of exclusive preinstallation. In her view, the combined effects of those accords, along with mobile application distribution agreements - which required manufacturers to preinstall certain Google apps in exchange for access to the Play Store - contributed to Google's market entrenchment.
She also emphasized that the commission need not show that equally efficient rivals were actually excluded, only that they could have been. In Kokott's view, "no hypothetical as-efficient competitor could have found itself in such a situation," due to Google's entrenched dominance and the self-reinforcing power of data and defaults.
Thomas Hppner, a competition lawyer and partner at Hausfeld in Berlin, said: "In her opinion, Kokott further fine-tunes the 'not (yet) as efficient competitor' principle. There is a growing understanding that the more entrenched a dominant position, the lower the threshold for finding that a practice harms competition, especially where high barriers to entry exist."
The case has drawn wide attention for its implications on tech giants, but some experts say it reflects settled legal doctrine rather than a shift.
"This case is important because it is a classic one," said Nicolas Petit, a professor of competition law at the European University Institute and former member of the European Commission's High-Level Expert Group on Artificial Intelligence. Since the fine was first issued, Brussels has tightened platform regulation through new laws like the Digital Markets Act.
"The issues do not concern any groundbreaking form of business conduct but involve plain vanilla competition law logic. The fact that the defendant is a large tech platform is more a distraction than anything else," Petit said. He warned that focusing too heavily on the digital context risks "deviation from established practice."
A Google spokesperson expressed disappointment, saying that the decision "could discourage investment in open platforms and harm Android users, partners and app developers."
Though non-binding, Kokott's opinion is expected to carry weight with the Court of Justice, which will issue a final ruling in the coming months.
Source: Courthouse News Service
