The European Union has fined Google’s parent company Alphabet €890 million (approximately $1 billion) for two separate violations of the bloc’s Digital Markets Act (DMA). The penalties, announced by the European Commission, focus on Google giving its own products preferential treatment in search results and restricting Android developers from steering users to alternative payment systems. Google has been ordered to change its policies within 60 days or face additional periodic penalty payments.

The first fine, amounting to €460 million, stems from Google’s practice of favoring its own Shopping, Hotels, and Flights services in Google Search results. The second penalty of €430 million relates to Play Store rules that prevent developers from freely informing users about cheaper alternative payment options outside Google’s ecosystem. Together, these fines represent a significant enforcement action under the DMA, which targets the largest “gatekeeper” companies that provide core digital services in Europe.

Details of the Violations

The European Commission determined that Google’s search practices violated the DMA by giving its own vertical services an unfair advantage over third-party competitors. For years, Google has integrated its shopping, hotel, and flight comparison tools directly into search results, often placing them above organic links to rival services. This self-preferencing, according to the Commission, stifles competition and limits consumer choice. The €460 million fine is intended to penalize this behavior and signal that gatekeepers must treat third-party services equally.

The second violation revolves around Google’s Play Store policies. Developers distributing apps through the Play Store were required to use Google’s billing system, which charges commissions of up to 30% on in-app purchases. The DMA mandates that gatekeepers allow developers to steer consumers to alternative payment methods, such as external websites or third-party payment processors, which may offer lower fees. The Commission found that Google’s restrictions on “anti-steering” clauses violated this requirement, leading to the €430 million fine.

As part of the ruling, Google must implement specific changes. For Search, the company is required to treat third-party comparison services in a “fair and non-discriminatory manner,” effectively removing any algorithmic or visual bias toward its own offerings. For the Play Store, Google must allow Android developers to freely promote offers to users both inside and outside the app store, including by providing direct links to alternative payment options. The compliance deadline is 60 days, after which the Commission may impose daily fines until changes are fully implemented.

Background and Historical Context

This is not the first time Google has faced EU antitrust action over similar issues. In 2017, the Commission fined Google a record €2.42 billion for abusing its dominance in the shopping comparison market. That case, which also centered on self-preferencing in Search, required Google to adjust its search algorithms to give rival comparison services equal visibility. The latest fine builds on that precedent, applying the stricter DMA rules that came into effect in 2024.

The DMA was designed to regulate the largest digital platforms, known as gatekeepers, to ensure fair competition and greater choice for consumers and businesses. Companies like Google, Apple, Meta, and Amazon are subject to a range of obligations, including bans on self-preferencing, restrictions on data use, and requirements to allow third-party interoperability. The maximum fine for a DMA violation is 10% of a company’s global annual revenue, which for Google in 2025 would be about $40 billion based on its reported $400 billion in revenue. The €890 million fine, while substantial, is well below that ceiling.

Google had been under investigation since the DMA took effect, with the Commission opening a non-compliance probe in early 2025. A preliminary ruling was issued in March 2025, giving Google time to address the concerns. However, the Commission found the company’s initial proposals insufficient. In May 2026, an extension was granted after the Commission stated that Google's previous proposal “is simply not strong enough.”

Google’s Response and Arguments

Google has repeatedly pushed back against the EU’s demands. In May 2026, a company spokesperson told Reuters that the changes required to achieve DMA compliance “represent the biggest downgrade in the product’s history, creating a second-rate experience for Europeans to the benefit of a few self-interested complainants.” The company argued that modifying Search results to give equal weight to third-party services would degrade the user experience and make it harder for consumers to find relevant information quickly.

Regarding the Play Store, Google has long contended that opening up app distribution to alternative payment systems poses security risks to users. In a blog post from 2025, the company stated: “The DMA is making it difficult to protect users from scams and malicious links on Android by forcing us to remove our legitimate safeguards that protect users’ security and safety.” Despite these objections, Google updated certain terms following consultations with the European Commission and other experts, revising fees and restrictions on Android developers. The Commission acknowledged these changes as “good progress towards compliance.”

Broader Implications and Parallel Developments

The fines come at a time when Google is facing increased regulatory scrutiny globally. In the United States, a federal judge ruled in 2024 that Google held an illegal monopoly over online search and text advertising, and the Department of Justice is considering remedies that could include breaking up the company. Separately, Epic Games, the publisher of Fortnite, successfully sued Google over its Play Store policies, leading to a court order that will force Google to carry rival Android app stores inside its own platform.

In Europe, the DMA is also affecting other gatekeepers. Apple has been forced to open its iOS ecosystem to alternative app stores and payment systems, while Meta has faced restrictions on data use for advertising. The European Commission has indicated that it will continue to monitor compliance and impose penalties where necessary.

Google’s search product has also undergone significant changes in recent months. In May 2026, at its I/O developer conference, the company introduced a reimagined AI-focused search box that integrates generative AI responses directly into search results. This feature, which has rolled out to EU users, could further complicate compliance with the DMA, as the AI summaries may once again give preference to Google-owned content. The Commission has not yet commented on whether the AI integration raises additional concerns.

The €890 million fine is a clear signal that the EU intends to enforce the DMA rigorously. As Teresa Ribera, the Commission’s executive vice-president for clean, just and competitive transition, stated: “The best products should succeed because they’re better, not because they’re owned by the company running the search engine. And European consumers have a right to be told by app developers where to sign up to the best offers, even when the app store owner does not get a cut. This is the promise of the DMA, protecting fairness, choice and innovation in digital markets for the benefit of all European citizens.”

Google now has 60 days to demonstrate compliance. If the required changes are not fully implemented, the Commission can impose periodic penalty payments of up to 5% of Google’s average daily worldwide turnover. The tech giant’s next steps will be closely watched by regulators, competitors, and consumers across the globe.

Source:The Verge News