Key takeaways
- Digital market enforcement policy confirmed: the CJEU has endorsed the Commission’s approach to enforcing competition law in the digital market.
- Faster enforcement: the DMA replaces protracted competition law proceedings with the expedited enforcement of specific obligations and prohibitions.
- Lower burden of proof: where gatekeepers are concerned, the Commission does not need to prove market power or abuse, only non-compliance with the DMA.
From complaint to fine: the thirteen-year battle in Google Android
The CJEU’s judgment in the Google Android case marks the conclusion of competition law proceedings that began with a complaint filed back in 2013. The highest European court confirmed that the Commission had rightly held in 2018 that Google had infringed the competition law prohibition on the abuse of a dominant position.
First, Google required manufacturers to pre-install the Google Search app and the Google Chrome browser app as a condition for licensing the Play Store. According to the CJEU, such tying practices by a dominant undertaking are, in principle, problematic from a competition law perspective. Second, manufacturers wishing to pre-install Google apps were required to undertake not to develop or sell devices running on alternative versions of Android not approved by Google (‘Android forks’). The CJEU ruled that this finding was not undermined by the Commission’s failure to prove that the exclusivity payments made by Google to large manufacturers and mobile network operators were unlawful. Under those arrangements, the manufacturers and operators received payments in exchange for pre-installing Google Search exclusively on their devices.
Google and the DMA
In July, the Commission established that Google had committed two breaches of the DMA. The Commission found that Google unlawfully gave its own services – such as shopping, hotel, transport and sports search results – preferential treatment in Google Search over comparable services of other providers. Google did so by displaying its own services more prominently, including at the top of the search results page or by using enhanced visuals and filters. The Commission also found that Google prevented app developers from freely informing users about offers and from concluding contracts via alternative distribution channels outside Google Play, such as third-party app stores. Although Google is permitted to charge a fee for introducing new customers via Google Play, both the level of these fees and the length of the charging period went beyond what is permitted by the DMA.
What we can learn from the Google fines: a new enforcement regime
The concurrence of the judicial confirmation of the competition law fine and the DMA fines imposed on Google illustrates the ongoing transition from digital sector intervention based on ‘traditional’ competition law to intervention based on sector-specific regulation. One advantage of this shift is that the Commission can act more quickly under the DMA than under competition law. Whereas it took the Commission five years to reach a final decision in Google Android, the investigation leading to the DMA decisions against Google took just over two years – cutting the processing time by more than half. This was due in part to the lower burden of proof under the DMA; the Commission no longer needed to prove that Google held a dominant position and that the conduct in question constituted an abuse. As Google had been designated as a gatekeeper, the Commission simply needed to establish that Google was not complying with the specific obligations and prohibitions set out in the DMA.
Although the DMA is founded on the concept of regulatory dialogue – under which gatekeepers and the Commission consult one another on the DMA’s implementation – the decisions against Google confirm that the Commission will not engage in dialogue indefinitely. The Commission is thus continuing the approach it adopted last year when it fined Apple and Meta for breaching the DMA.
These developments provide a clear point of reference for businesses relying on Google or other major platforms: the rules under the DMA are specific, and enforcement, including when triggered by complaints, is relatively swift. If you have any questions about the impact of the DMA on your business, please do not hesitate to contact us.
