Google is fighting to keep a €1.49 billion EU antitrust fine scrapped over old AdSense contract rules

Google is having one of its worst weeks in Europe. The company is fighting to kill a $1.7 billion fine in court, bracing for new EU penalties, and facing a sharp report on how its AI treats children.

At Europe’s top court Wednesday, Google asked the Court of Justice of the European Union to reject EU competition regulators’ appeal against a 2024 lower court ruling that wiped out a €1.49 billion fine.

The lower court had said regulators made errors in building their case. Now the European Commission wants that ruling reversed.

The original dispute involves Google’s AdSense advertising platform.

Between 2006 and 2016, the Commission accused Google of using restrictive contract terms to stop rival companies from placing search ads on third-party websites. Regulators issued the €1.49 billion fine in 2019.

Google dropped the disputed clauses in 2016, but the Commission pressed ahead with the penalty anyway.

In court Wednesday, Google’s lawyer Josh Holmes defended the lower court’s decision, saying its reasoning was “clear and complete.”

He argued regulators had ignored evidence showing competitors had real and meaningful chances to win business. Commission lawyer Anthony Dawes pushed back hard.

“This finding turns case law on its head,” he said, arguing the ruling would effectively treat exclusive contract clauses as legal by default and put an unfair burden on regulators.

A court adviser is due to issue a non-binding opinion on November 12. A final ruling will follow. The case is part of a much longer fight.

Google and the EU have been clashing over antitrust matters for close to two decades, costing the company billions along the way.

New fines on the horizon

As the dispute continues, Google is facing another challenge. Internal documents from the European Commission indicate that EU regulators are preparing to issue new penalties against the company in the coming week under the Digital Markets Act.

The legislation was introduced to impose tougher obligations on the biggest technology platforms and ensure they follow stricter competition rules.

The upcoming fines could amount to hundreds of millions of euros. In addition, Google may face ongoing daily penalties if it fails to make the required changes within a 60-day deadline.

The new action covers two areas. In the first, the Commission is expected to find that Google has been unfairly promoting its own shopping, travel, and other services over rivals in its search results.

In the second, regulators want the Google Play Store to give app developers more freedom to point users toward competing platforms.

Under the Digital Markets Act, companies can be fined up to 10 percent of their total global revenue. Alphabet, Google’s parent company, posted $402.83 billion in revenue last year.

Google said it was “keen to bring these investigations to a close so we can get back to developing innovative products for our users.”

The company was also critical of changes it has already made under the DMA, calling them “the biggest downgrade in the product’s history” and saying they had created “a second-rate experience for Europeans to the benefit of a few self-interested complainants.”

AI safety concerns for children

A children’s digital safety group expressed grave concerns about Google’s AI tools, which increased the pressure.

According to research published by Common Sense Media, Google’s AI is especially concerning because it is “ubiquitous on children’s personal and school-issued devices,” as Chromebook computers are frequently used in classrooms.

The study discovered that young users had serious issues with Google’s “AI Mode” chatbot and its automatic “AI Overview” feature, which shows up in Google search results. Students’ schoolwork would be completed by the AI, which frequently provided inconsistent or incorrect responses.

More concerning, the investigation discovered that the system “failed kids in crisis, including missing clear signs of suicidal ideation, reinforcing signs of psychosis and mania, validating disordered eating including purging and celebrating cannabis use.”

Google’s AI features fell short on seven out of eight child safety standards the group tested. On top of that, neither AI Mode nor AI Overview can be switched off, leaving children at school and on personal devices with no way to opt out.

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