Google agrees $7.8 million antitrust settlement with Russian Federation

Posted April 18, 2017

Google is battling against similar anti-trust cases in the European Union, where BT recently took the search giant's side.

The deal sets a new precedent for the tech giant, which faces multiple complaints worldwide that it is abusing its dominant position by imposing restrictions on manufacturers of Android-based devices in order to protect its share of the online search market. While Chrome allows users to easily change the search engine, there is no way at the system-level to have easy access to another engine.

As part of today's settlement, "Google will no longer demand exclusivity of its applications on Android-based devices in Russia", FAS said.

The company will pay a fine of 438 million rubles ($7.8 million) and allow Android phone makers to pre-install third-party services such as Yandex, including on the first screen, as part of the settlement approved by Moscow District Arbitration Court, Aleksey Dotsenko, the antitrust regulator's deputy head, told reporters. "Smartphone manufacturers will also have more freedom to select the apps that they preinstall on devices".

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The $7.8 million fine is roughly 9 percent of Google's 2014 revenue in Russian Federation. The FAS Russia, driven by the necessity to eliminate consequences of the violation and to restore competition in the market, agreed to sign the settlement agreement.

In August a year ago, Russian authorities slapped a 438 million ruble ($6.75m) fine on Google, concluding that the company was "forcing its partners to feature its services". Yandex now holds a 55 percent share of the search market in Russian Federation, while Google clings to a 40 percent share. The addition of a choice window provides users with the opportunity to choose their default search engine.

At the same time, Google will by no means limit or impede pre-installation of other developers' applications on the users' devices. These developments will help Google to fulfill their obligation to "not to restrict pre-installation of any competing search engines and applications".

FAS said that Google's policy restricted installation of applications by other developers. "The settlement's execution will have a positive effect on the market as a whole, while giving developers additional options for promoting their products".