Competition Bureau sues Google for anti-competitive conduct in online advertising in Canada

GATINEAU, QC, Nov. 28, 2024 /CNW/ - The Competition Bureau is taking legal action against Google for anti-competitive conduct in online advertising technology services in Canada. Following a thorough investigation, the Bureau has filed an application with the Competition Tribunal that seeks to remedy the conduct for the benefit of Canadians.

This case is about online web advertising, which consists of ads shown to users when they visit websites. Many publishers count on digital ad revenue to support their activities and reach. Digital ad inventory is often purchased and sold through automated auctions using sophisticated platforms. These individual platforms are known as ad tech tools while the entire suite of tools used throughout the buy and sell process are collectively known as the ad tech stack.

The Bureau's investigation found that, in Canada, Google is the largest provider across the ad tech stack for web advertising and has abused its dominant position through conduct intended to ensure that it would maintain and entrench its market power. Google's conduct locks market participants into using its own ad tech tools, prevents rivals from being able to compete on the merits of their offering, and otherwise distorts the competitive process.

In particular, the Bureau found that Google has:

• unlawfully tied its various ad tech tools together to maintain its market dominance; and
• leveraged its position across these ad tech tools to distort auction dynamics by:
  • giving its own tools preferential access to ad inventory,
  • taking negative margins in certain circumstances to disadvantage rivals, and
  • dictating the terms on which its own publisher customers could transact with rival ad tech tools.

The Bureau's position is that by implementing this anticompetitive conduct, Google has been able to entrench its dominance, prevent rivals from competing, inhibit innovation, inflate advertising costs and reduce publishers' revenues.

The Bureau's application with the Competition Tribunal seeks an order that, among other things:

• requires Google to sell two of its ad tech tools;
• directs Google to pay a penalty to promote compliance with the Competition Act; and
• prohibits Google from continuing to engage in anticompetitive practices.

The final decision in this matter rests with the Competition Tribunal.

A backgrounder with more information on the Bureau's investigation and next steps is available on our website. The application to the Competition Tribunal will be available on the Tribunal's website shortly.

Quotes

"The Competition Bureau conducted an extensive investigation that found that Google has abused its dominant position in online advertising in Canada by engaging in conduct that locks market participants into using its own ad tech tools, excluding competitors, and distorting the competitive process. Google's conduct has prevented rivals from being able to compete on the merits of what they have to offer, to the detriment of Canadian advertisers, publishers and consumers. We are taking our case to the Tribunal to stop this conduct and its harmful effects in Canada."

Matthew Boswell
Commissioner of Competition

Quick facts

• A recent Bureau study showed that a decline in competition deprives both businesses and consumers of the benefits of a competitive economy, including lower prices, greater choice, and more innovation.
• Online web advertising consists of ads shown to users when they visit websites.
• Advertisers and publishers use advertising technology services to support the selling and buying of online web ads. 
• Google is unquestionably the largest provider of ad tech tools across the supply chain.
• In 2021, the Bureau obtained its first court order related to this investigation into Google's online advertising business.
• Earlier this year, the Bureau obtained another court order and expanded its investigation. 
• The Bureau also investigated Google in 2016 for alleged anti-competitive conduct relating to online search, search advertising and display advertising. At that time, the Bureau committed to closely follow developments with respect to Google's conduct.

Related products

• Backgrounder: Competition Bureau sues Google for anti-competitive conduct in online advertising

Associated links

• Competition Bureau expands its investigation into Google's advertising practices
• Competition Bureau obtains court order to advance an investigation of Google
• Competition Bureau completes extensive investigation of Google
• Restrictive trade practices
• Why competition matters

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The Competition Bureau is an independent law enforcement agency that protects and promotes competition for the benefit of Canadian consumers and businesses. Competition drives lower prices and innovation while fueling economic growth.

SOURCE Competition Bureau

Contacts: Media inquiries: Media Relations, Email: [email protected]