Russia Fines Google $6.75 Million For Violating Antitrust Rules

The Russian Federal Antimonopoly Service (FAS) has fined Alphabet Inc.’s Google 438 million rubles ($6.75 million) on Thursday for violating antitrust rules on tablets and mobile phones. In other words, Google has been found guilty for exploiting its dominant market position by forcefully making retailers install its search engine and keep a suite of apps on mobile phones for sale on the Russian market.

In September last year, the FAS found Google guilty in breach of a law on “protecting competition” after Russia’s largest search engine, Yandex NV filed a complaint against the search giant. It asked anti-trust authorities to stop Android handsets from being automatically pre-loaded with Google’s own apps and services. Google also didn’t allow third-party services, such as Yandex’s search, to be preinstalled.

Google has two months to pay the fine, said the FAS. The fine amount was calculated as a share of Google Play’s domestic sales, a FAS representative said. Local rules specify that fines signify 1 percent to 15 percent of a violator’s revenue for 2014, the official said, without providing more information on the exact figure.



“We are sure that the requirements will provide the possibility for development of competition on the mobile software market in Russia, which will have a positive effect for consumers,” said Yelena Zayeva, the head of its department for regulating communications and IT.

All companies whose production is on sale in Russia have to observe the law on competition, “including transnational corporations,” Zayeva added.

After receiving notification from FAS about the fine, Google said in an e-mailed statement: “We have received notice of the fine from FAS and will analyze closely before deciding our next steps.”

“In the meantime, we continue to talk to all invested parties to help consumers, device manufacturers and developers thrive on Android in Russia,” Google said.

The FAS has ordered Google to make changes to its agreements with device makers. However, the search giant has appealed the solutions. The latest appeal hearing has been scheduled for August 16.

Google has been slapped with similar anti-trust charges in other countries, particularly in the European Union, which has launched three cases against Google, one of which is particularly about using the dominance of the Android mobile phone operating system to limit competition.

Source: Bloomberg