Competition Bureau ‘carefully reviewing’ European crackdown…


‘Should new evidence come to light of anti-competitive conduct that may affect the Canadian marketplace … (we will) take appropriate action’

Canada’s Competition Bureau says it is “carefully reviewing” the recent rebuke that Google LLC received for violating the European Union’s antitrust rules.

The European Commission announced on July 18 that it had fined Google approximately $6.7 billion over “illegal practices” connected to the company’s Android mobile operating system.

According to the commission, the search giant had “imposed illegal restrictions” on Android device manufacturers, as well as on mobile network operators, since 2011. A release said this was done “to cement (Google’s) dominant position in general internet search.”

Alphabet Inc., Google’s parent company, has said it intends to appeal the European Commission’s latest decision.

On Monday, a Competition Bureau spokesperson told the Financial Post that the Canadian agency, while mindful of the differences between the legal regimes, “continues to monitor firms in the digital economy, including Google, to ensure they do not engage in anti-competitive conduct.”

“We follow the developments of investigations by our international counterparts, and we are carefully reviewing the recent actions taken by the European Commission,” Jayme Albert said in an email. “Should new evidence come to light of anti-competitive conduct that may affect the Canadian marketplace, by Google or any other market participant, the Bureau won’t hesitate to take appropriate action.”

The bureau issued a similar warning over two years ago, in April 2016, when Canada’s competition commissioner announced that a probe of Google — prompted by allegations of anti-competitive conduct — had been discontinued.

At the time, however, the commissioner said the bureau would keep an eye on the situation, “including the results from investigations of our international counterparts.”

The competition bureau’s spokesperson said Monday that it would be “inappropriate to comment further,” as the agency is legally required to do its work confidentially.

“Generally speaking, whenever the Bureau becomes aware of alleged anti-competitive behaviour, it conducts a thorough and complete examination of the facts as they relate to Canada before reaching any conclusion as to whether or not the Competition Act has been contravened,” Albert said.

As of publication, Google had not responded to questions from the Financial Post.

Among the Competition Bureau’s findings in 2016 was that Google “used anti‑competitive clauses in its AdWords Application Programming Interface (API) Terms and Conditions” that the agency concluded were meant to keep out rivals. Google removed those clauses and made a commitment to Canada’s competition commissioner not to reintroduce them for five years.

The Competition Bureau also said in 2016 that it did not find sufficient evidence to back up the other allegations of anti-competitive behaviour. Subsequently, a memo prepared within the federal Department of Canadian Heritage in June 2016, and later obtained by the Financial Post, noted that the 50.5 per cent market share Android had in Canada at the time was smaller than the 90-per-cent share in the EU.

We’ve shown we’re willing to make changes. But we are concerned the decision will upset the careful balance we have struck with Android, and that it sends a troubling signal in favour of proprietary systems over open platforms

Google CEO Sundar Pichai

In response to the EU’s latest decision, Google CEO Sundar Pichai wrote in a blog post that the company has “always agreed that with size comes responsibility.”

“A healthy, thriving Android ecosystem is in everyone’s interest, and we’ve shown we’re willing to make changes,” he added. “But we are concerned that today’s decision will upset the careful balance that we have struck with Android, and that it sends a troubling signal in favour of proprietary systems over open platforms.”

The fine announced last week followed another the European Commission levied against Google in June 2017 for “abusing its dominance as a search engine by giving an illegal advantage to Google’s own comparison shopping service,” a release said. Alphabet says it appealed that EC decision in September 2017, and has since made changes to bring shopping ads into compliance with the European ruling.

The search giant is still under investigation by the European Commission for “restrictions” the company allegedly placed on third-party websites to show search advertisements from Google’s competitors.

The fines to date are still relatively small compared with the amount of money making its way to Alphabet. The Mountain View, Calif.-based firm reported on Monday second quarter revenues of US$32.7 billion.

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