The Commission’s in-depth investigation will not only examine the potential outcomes for the advertising market if the deal goes ahead, but it will also examine the deal’s effects on the digital healthcare industry and the possibility for Google to block competitors’ access. to Android users.
The data provided by portable devices “provides key information on the lives and health status of users of these devices,” said Margrethe Vestager, European Commission competition officer, in a written statement. “Our investigation aims to ensure that Google’s control over data collected via portable devices as a result of the transaction does not distort competition. ”
Google announced plans to acquire Fitbit in November in a deal valued at $ 2.1 billion. Any merger or acquisition of this magnitude attracts the attention of antitrust authorities in both the United States and the EU, and regulators in every country in which companies operate have begun their merger review process.
Reviews of European mergers take place in two phases. In the first phase, competition regulators conduct a preliminary investigation. If they don’t identify any real issues with the deal, the companies can proceed with their transaction. However, if preliminary investigation reveals potential for damage, regulators switch to a phase two probe.
Following the phase one investigation, the Competition Bureau sought concessions from Google in connection with the acquisition. Sources said at the time that if Google did not comply with these terms, an extended investigation would likely follow, and it now appears to be happening.
The transaction is also under scrutiny here in the United States. Under US law, companies considering a merger of a certain value (currently $ 94 million) must submit a notification to both the Federal Trade Commission and the Department of Justice. Once a company submits that filing, regulators have 30 days to review the proposal and determine whether to issue a second request for additional information and investigate the matter further. The DOJ issued a second request to Google and Fitbit in April and is currently reviewing the deal.
Google, meanwhile, is under scrutiny for possible antitrust violations virtually everywhere. The European Commission is among many agencies probing its behavior and market dominance, as are the DOJ, the attorneys general of 50 U.S. states and territories, and Congress, which toast Google CEO Sundar Pichai as well. as executives from Apple, Amazon and Facebook, on antitrust issues in a six-hour hearing last week.