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The Morning Risk Report: Google Fine Spotlights Differing Regulatory Approaches of EU, U.S.

The Wall Street Journal

July 19, 2018

The €4.34 billion ($5.06 billion) fine levied by the European Union against Alphabet Google highlights the differences with the U.S. in how the two regions view their roles in antitrust regulation, said an attorney who previously worked in the antitrust unit at the U.S. Department of Justice.

The fine announced Wednesday shows the EU’s willingness to rein in the operations of big tech companies, whereas the U.S. takes a more hands-off approach. This divergence in philosophy means it’s unlikely Google will suffer any ramifications in the U.S. due to the EU’s decision, said Ben Brown, co-chair of the antitrust practice at law firm Cohen Milstein Sellers & Toll.

The U.S. enforcement agencies have generally “taken a hands-off approach,” said Mr. Brown, while the consensus in the American antitrust community it is unlikely similar cases will be litigated in the U.S.. “And with this administration, or any administration for that matter, you would be unlikely to see any kinds of enforcement actions,” he said.

The EU antitrust regulator determined Google abused the dominance of its Android operating system to promote and entrench the company’s cash-cow search engine. Brussels ordered Google to rip up parts of agreements with mobile-phone makers and telecommunications operators.

Regulators said the deals effectively force those companies to pre-install the Google search engine and its Chrome browser in versions of Android that Google provides, free of charge, for use in phones and other devices. That means Google may have to stop offering incentives to manufacturers to pre-install its software in Europe, said Mr. Brown.

While Google may have to stop offering incentives to handset manufacturers to preinstall its search engine and Chrome browser, it wouldn’t necessarily have to stop making those offers in the U.S., said Mr. Brown.

“They can adopt different business practices for different sides of the Atlantic,” he said. “The broader application of this rule will have some benefits for competition in Europe, but it won’t translate” in the U.S.

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