Google faces a €2.95 billion penalty from the European Commission due to misuse in its ad tech practices

The European Commission has imposed a fine of €2.95 billion on Google for abusing its dominant position in the digital advertising technology sector. The decision, announced on September 5, 2025, reflects previous EU Court decisions upholding substantial fines against Google and marks a critical juncture for digital advertising competition in Europe and globally.

Google's breach of EU competition rules can be traced back to favouring its own online display advertising technology services over competitors between 2014 and the present. The Commission found that the tech giant systematically favoured its AdX exchange over competing exchanges, resulting in reduced revenues for publishers. This, in turn, may have led to lower service quality and higher subscription costs for consumers.

Google's dominant position extends to both publisher ad servers through DoubleClick For Publishers (DFP) and programmatic ad buying tools through Google Ads and DV360 across European Economic Area-wide markets. The Commission's investigation revealed that Google's "Dynamic Revenue Optimization" and "Sell-Side Dynamic Revenue Share" programs were designed to advantage AdX, systematically favouring it over competing exchanges.

Advertisers faced higher marketing costs, which they likely passed on to European consumers in the form of higher prices for products and services. Multiple companies and organizations have expressed support for stronger enforcement measures against Google in response to these practices.

The Commission ordered Google to implement measures ending these self-preferencing practices within 60 days. Google is expected to propose behavioral modifications rather than asset divestiture, setting up potential additional enforcement proceedings if the Commission deems proposed measures insufficient.

The decision establishes important precedent given parallel US litigation against Google in Department of Justice proceedings. The case also comes amid broader EU efforts to regulate large technology platforms through mechanisms including the Digital Markets Act and Digital Services Act.

The advertising technology markets generated approximately 12% of Alphabet's revenue, totaling $42 billion in recent reporting periods. The Commission's fine is the fourth prohibition decision against Google for abuse of dominance.

Industry observers anticipate that the decision will have far-reaching implications for the digital advertising industry, potentially leading to increased competition and fairer practices. The case represents a significant step towards ensuring a level playing field in the digital advertising sector and protecting consumers' interests.

Google faces a €2.95 billion penalty from the European Commission due to misuse in its ad tech practices