Introduction
Mexico's antitrust authority is poised to announce a ruling on Google's alleged monopoly in the digital advertising sector by June 17, a decision that could impose a significant financial penalty on the tech giant.
Context
The Federal Economic Competition Commission (Cofece) has been investigating Google since 2020, focusing on claims that the company has established an effective monopoly in the Mexican digital advertising market. Public documents indicate that if found liable, Google could face a fine of up to 8% of its annual revenue in Mexico, which could amount to billions of dollars.
- Cofece has requested financial documents from the tax authority SAT to support its case.
- Google has the right to contest any ruling through an injunction until it can be reviewed by a specialized court.
Developments
Cofece's investigation intensified in 2023 with a summons issued to Google, allowing the company to present evidence in its defense. Historically, the largest fine imposed by Cofece was 2.4 billion Mexican pesos on a group of liquefied petroleum gas distributors in 2022 for price-fixing.
In May, an oral hearing with Google marked a significant milestone in the ongoing case, highlighting the scrutiny the tech giant is under. Meanwhile, Google parent company Alphabet reported approximately $20.4 billion in revenue for its Latin America region in its 2024 annual results.
Conclusion
The potential ruling by Cofece could reflect broader trends in antitrust actions against major tech companies, similar to challenges faced by Google in the United States. Mexican lawmakers, particularly from the ruling Morena party, have urged for a resolution to this prolonged case, bringing attention to the growing concern over monopolistic practices in the digital marketplace.