Moscow Court Rejects Google Appeal of $6.8M Fine

It's up to Google now to decide whether it will pay up and comply with other requirements imposed by the lower court.

Google antitrust

A Russian court rejected Google's appeal of a lower court finding in an antitrust case involving the company's Android bundling practices.

The decision by Moscow's Ninth Arbitration Court of Appeal leaves intact a judgment by the country's Federal Antimonopoly Service (FAS) earlier this month ordering Google to pay a fine of $6.7 million and to change its Android installation requirements in Russia.

Russian news service Tass reported on the development this week. It quoted the head of FAS as expressing satisfaction with the appeals court's decision and expressing hope that Google would comply in full with the judgment entered against it.

Google did not respond immediately to a request for comment. So it is unclear what the company's next move will be and whether it will pay the fine or change its Android business practices in Russia.

The dispute stems from a complaint filed last year by Russian search engine and internet firm Yandex, which claimed it was being unfairly deprived of an opportunity to have its mobile applications installed on Android handsets because of Google.

According to the company, a Google requirement that Android device manufacturers who pre-install Google Play on their devices also must install Google Search, Google Maps and other applications effectively blocked others from having their applications on the same devices.

After a months-long investigation, the FAS, Russia's enforcer of anti-monopoly laws, ruled last October that Google's bundling practices violated Russian laws and ordered the company to change them.

The $6.7 million fine, Google's subsequent appeal of that decision and the appellate court’s rejection of that appeal this week all stem from that FAS judgment last year.

For Google, the latest development, while not surprising—this is the second time the Moscow Arbitration Court has rejected a Google appeal in the case—is likely troubling.

The company faces scrutiny over the same Android bundling issue in at least two other places.

European Union Commissioner for Competition Margrethe Vestager earlier this year announced that her office had launched a formal investigation to see whether the Android bundling requirement is, in fact, unfair. Just last week, South Korea's Fair Trade Commission said that it too had opened an inquiry into Google's application-bundling practices.

Google has maintained its practices are consistent with local laws in all the countries in which it operates. So far at least, despite a few unfavorable verdicts like the one in Moscow this week, the company appears to have done little to change its business practices in a major way in response to such disputes.

However, in a few instances, Google has acquiesced to certain demands. In the United Kingdom, for example, the company agreed to pay the equivalent of nearly $170 million to settle claims that it had avoided paying its fair share of taxes on revenue earned there.

Similarly, in the European Union, the company earlier this year agreed to apply the Right to be Forgotten mandate more broadly after months of stubbornly refusing to budge on the issue.

Jaikumar Vijayan

Jaikumar Vijayan

Vijayan is an award-winning independent journalist and tech content creation specialist covering data security and privacy, business intelligence, big data and data analytics.