Washington Will Struggle to Challenge—or Copy—the European Union's $5 Billion Google Fine

While President Trump wants to take on Europe’s record-breaking antitrust penalty, some congressional Democrats hope to emulate it at home. Neither is likely to succeed.

European Union Commissioner Margrethe Vestager holds a press conference on a Competition Case involving Google Android at the European Commission building in Brussels on July 18.
AP Photo/Olivier Matthys
July 19, 2018, 8 p.m.

The European Commission’s decision this week to fine Google a record $5 billion for violating European antitrust law set off both President Trump and congressional Democrats—though for two very different reasons.

“I told you so!” the president tweeted Thursday morning. “The European Union just slapped a Five Billion Dollar fine on one of our great companies, Google. They truly have taken advantage of the U.S., but not for long!”

At the same time, a handful of Democrats expressed hope that American antitrust officials will emulate their European counterparts in curbing Google’s dominant position in the mobile-operating-system marketplace.

“[The decision] is a powerful impetus to stronger antitrust enforcement in our nation against Google’s market dominance and misuse of its power,” Sen. Richard Blumenthal told reporters Wednesday. “The [Federal Trade Commission] should reopen its investigation and make use of the fact-finding done by European authorities.”

But neither Trump nor congressional Democrats are likely to achieve their stated desires in response to Europe’s landmark enforcement action. Washington’s leverage against the European Commission remains limited at best. And outside of the president—who’s been known to lose interest in the policies he discusses via tweet—few Republicans have shown an interest in going to bat for Google.

“Google has become a political punching bag for Republicans,” said Berin Szoka, the head of libertarian tech group TechFreedom and a fierce critic of the EU’s decision. “It has become essentially impossible for any Republican to defend Google in any way.”

Democratic lawmakers, meanwhile, are likely misreading both U.S. antitrust jurisprudence and the FTC’s willingness to take Google to task.

“If our antitrust agencies are being run by free-market ideologues right now, then it’s not even a conversation worth having,” said Hal Singer, an economist at George Washington University’s Regulatory Studies Center and a supporter of the EU’s latest action. “But let’s assume they do want to go after Google—the question is, what are the prospects? And I think under U.S. standards, the prospect of a victory would be dim.”

The European Commission’s new fine is the largest in antitrust history, blowing well past the $2.7 billion penalty it levied against Google for a separate violation last year. European antitrust chief Margrethe Vestager contended that Google used the dominant position of Android, its smartphone operating system, to coerce device manufacturers into preloading Google apps onto their products, which disadvantaged independent app developers.

Google immediately announced its intent to appeal the decision, with chief executive Sundar Pichai arguing that it could lead the company to restrict Android access for phone makers and app developers.

Trump’s tweet ostensibly indicates a Republican desire to confront the EU for the enforcement action, which is viewed in some corners as protectionist and unfairly focused on American tech firms.

“This is probably the best example of where the European Union is profoundly anti-American,” said Szoka, arguing that Republican lawmakers should join the president in speaking up on Google’s behalf. “Somebody has to set the record straight here, and just point out that this is not the way to do antitrust law and has much broader implications than just for Google.”

But congressional Republicans have so far been hesitant to back Google in its standoff with European regulators. “Obviously you’re inclined to defend and support your country’s companies,” Sen. John Thune, the chairman of the Senate Commerce Committee, told National Journal on Wednesday. “But without having looked at the particulars, I’m not sure exactly.”

Rep. Greg Walden, the chairman of the House Energy and Commerce Committee, lent little credence to the notion that the massive penalty is driven by European populism and protectionism. “We want a competitive marketplace,” he said Wednesday. “And the bigger companies get, the more dominant that they are in the marketplace; if they squeeze out competition, then they’ll have a problem.”

There’s also the question of whether Trump’s tweet signifies actual White House policy, and if the president has the power to influence Europe’s antitrust enforcers.

“I don’t think [Trump’s] going to try to challenge it,” said Singer, suggesting the tweet was likely a one-off from an embattled and mercurial president. “Besides, it’s not in the U.S. jurisdiction. So the U.S. could lobby, but what could they do to try to block the EU?”

The White House did not respond to a request for comment.

Conversely, there’s little to suggest that U.S. antitrust regulators will target Google for similar enforcement action stateside.

Rep. Jan Schakowsky, the ranking member of the House Subcommittee on Digital Commerce on Consumer Protection, pressed FTC Chairman Joe Simons during a Wednesday oversight hearing on the need to investigate Google’s anticompetitive activities around its Android operating system.

But though he promised to carefully scrutinize the decision, Simons’s response suggested chances were slim that the commissioners will emulate their European peers. “Their regulatory regime is a little bit different than ours,” he told Schakowsky. While Europeans are focused on whether a dominant company treats its competitors fairly, Simons said the FTC must find evidence of consumer harm before bringing an enforcement action against a company.

“I’m very skeptical that someone could bring a case,” said Singer, arguing that longtime antitrust jurisprudence in the United States would set a much higher bar for enforcement than the European standard.

Szoka was more blunt. “It would be impossible to bring this same case in the United States,” he said. “You’d be laughed out of court.”

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