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Portuguese Competition Authority's Google investigation moves to the European Commission


Portuguese Competition Authority's Google investigation moves to the European Commission

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Press-Release 18/2022

September 9, 2022

The investigation

In recent years, the Portuguese Competition Authority (AdC) has been investigating in depth the digital markets in Portugal, including digital advertising.

Following a complaint and subsequent analysis of the concerned markets and questioning of its main economic agents, AdC decided, on May 17, 2022, to open administrative offence proceedings against Google for abuse of dominance. The proceedings have been, until now, under secrecy.

The AdC has collected indicia of self-preferencing behaviors by Google at various stages of the digital advertising value chain.

Namely, there are indicia that Google has used information not accessible by competitors on online advertisement auctions in order to change the outcome of those auctions in Google's favor, and has possibly limited the development of competing auction technologies, among other competition restricting behaviors in the context of negotiations with publishers.

Google's position in the markets

AdC's investigation concerned the market for publisher ad servers and the market for supply-side platforms, both part of the open display advertising value chain. These services allow publishers to manage the advertising space on their websites and to sell it through auctions or agreements with advertisers. These auctions determine which advertisements appear on users' pages when they browse the Internet. The evidence gathered by AdC indicates that Google has a dominant position in these markets.


AdC's cooperation with the European Commission

Following the AdC’s investigation and subsequent to the opening of the administrative offence proceedings against Google, the European Commission, on July 27, 2022, informed AdC that, in view of the scope and impact of the matter in question, it intended to extend the scope of its own investigation on Google to also include the practices and markets under investigation by AdC.

According to Regulation EC No 1/2003, the European Commission may decide to broaden to the whole EU an investigation initially under investigation by a national competition authority.

Under the rules of the ECN Network, the initiation of a case by the European Commission relieves the competition authorities of the Member States of their competence to initiate or proceed with an investigation on the same facts. As such, the AdC, on September 6, 2022, closed the investigation, which will henceforth be conducted by the European Commission.

In view of the serious concerns identified in its investigation, AdC reinforced with the European Commission the importance of investigating the Portuguese markets. AdC has also made available to the Commission all the information collected during its investigation.

It is AdC’s intention that its investigation and the information given by the Portuguese market stakeholders contribute to defend competition in the digital advertising markets, as well as ensure consumers’ wellbeing in Portugal.

A digital taskforce

The investigation to Google reflect the work AdC has been developing through its digital taskforce.

The digital taskforce was created in 2020, following AdC’s publication of the Issues Paper on the digital sector “Digital Ecosystems, Big Data and Algorithms”. The digital taskforce is an interdepartmental team of AdC, especially focused on ensuring effectiveness in detecting and investigating evidence of competition restrictive practices in the digital environment, as defined in the AdC’s priorities since 2020.

The digital taskforce has developed and applied digital research tools which have contributed to more efficiency in the analysis and reinforcement of evidence of competition restricting practices, significantly impacting the opening and investigation procedures of several administrative proceedings