EU antitrust regulators hit Google with record 2.42 billion euro fine

EU antitrust regulators hit Alphabet (GOOGL.O) unit Google with a record 2.42-billion-euro ($2.7 billion) fine on Tuesday, indicating they will likely take a tough line with the company in two other ongoing cases.

The European Commission said the world's most popular internet search engine has 90 days to stop favoring its own shopping service or face a further penalty of up to 5 percent of Alphabet's average daily global turnover.

The Commission found that Google had systematically given prominent placement in searches to its own comparison shopping service and demoted those of rivals in search results.

"What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation," European Competition Commissioner Margrethe Vestager said in a statement.

The action came after a seven-year long investigation prompted by scores of complaints from rivals such as U.S. consumer review website Yelp (YELP.N), TripAdvisor (TRIP.O), UK price comparison site Foundem, News Corp (NWSA.O) and lobbying group FairSearch.

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The sculpture of a Google Inc.'s Android mobile operating system mascot sits inside the Googleplex headquarters in Mountain View, California, U.S., on Thursday, Feb. 18, 2016. Google, part of Alphabet Inc., plans on tapping into existing fiber networks in San Francisco to deliver ultra-fast internet access across the city. Photographer: Michael Short/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: A view of the Head Office of Google on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
GURGAON, INDIA - MARCH 19: Breakout area at the Head Office of Google on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
GURGAON, INDIA - MARCH 19: A view of the Head Office of Google on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
A Google Inc. employee sits in a massage chair as she works on an Apple Inc. laptop computer with a colleague inside the company's offices in Berlin, Germany, on Friday, Aug. 16, 2013. Google, based in Mountain View, California, is seeking to revive Motorola Mobility's smartphone business, recently announcing a new flagship Moto X smartphone with customizable colors that will be assembled in the U.S. Photographer: Krisztian Bocsi/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: Reception area of Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
An employee walks in a hallway at Google Canada's engineering headquarters in Waterloo, Ontario, Canada, on Friday, Jan. 22, 2016. The 185,000-square-foot facility currently houses over 350 employees from Google's Canadian development team. Photographer: Cole Burston/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: A view of the Head Office of Google on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
A cyclist rides past Google Inc. signage near the entrance to the Googleplex headquarters in Mountain View, California, U.S., on Thursday, Feb. 18, 2016. Google, part of Alphabet Inc., plans on tapping into existing fiber networks in San Francisco to deliver ultra-fast internet access across the city. Photographer: Michael Short/Bloomberg via Getty Images
A cyclist rides past Google Inc. offices inside the Googleplex headquarters in Mountain View, California, U.S., on Thursday, Feb. 18, 2016. Google, part of Alphabet Inc., plans on tapping into existing fiber networks in San Francisco to deliver ultra-fast internet access across the city. Photographer: Michael Short/Bloomberg via Getty Images
A cyclist rides past Google Inc. offices inside the Googleplex headquarters in Mountain View, California, U.S., on Thursday, Feb. 18, 2016. Google, part of Alphabet Inc., plans on tapping into existing fiber networks in San Francisco to deliver ultra-fast internet access across the city. Photographer: Michael Short/Bloomberg via Getty Images
Google Inc. signage is displayed on an office building inside the Googleplex headquarters in Mountain View, California, U.S., on Thursday, Feb. 18, 2016. Google, part of Alphabet Inc., plans on tapping into existing fiber networks in San Francisco to deliver ultra-fast internet access across the city. Photographer: Michael Short/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: Employees play pool in the recreation area at Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
An employee checks her mobile device in the lobby of Google Canada's engineering headquarters in Waterloo, Ontario, Canada, on Friday, Jan. 22, 2016. The 185,000-square-foot facility currently houses over 350 employees from Google's Canadian development team. Photographer: Cole Burston/Bloomberg via Getty Images
An employee walks in a hallway at Google Canada's engineering headquarters in Waterloo, Ontario, Canada, on Friday, Jan. 22, 2016. The 185,000-square-foot facility currently houses over 350 employees from Google's Canadian development team. Photographer: Cole Burston/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: Breakout areas are scattered across each floor of the seven floor building of Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
GURGAON, INDIA - MARCH 19: Cool cafeteria at Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
An employee walks on a treadmill in the fitness center at Google Canada's engineering headquarters in Waterloo, Ontario, Canada, on Friday, Jan. 22, 2016. The 185,000-square-foot facility currently houses over 350 employees from Google's Canadian development team. Photographer: Cole Burston/Bloomberg via Getty Images
GURGAON, INDIA - MARCH 19: Breakout areas are scattered across each floor of the seven floor building of Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
GURGAON, INDIA - MARCH 19: Breakout areas are scattered across each floor of the seven floor building of Google Head Office on March 19, 2015 in Gurgaon, India. (Photo by Pradeep Gaur/Mint via Getty Images)
MOUNTAIN VIEW, CA - SEPTEMBER 02: The new Google logo is displayed on a sign outside of the Google headquarters on September 2, 2015 in Mountain View, California. Google has made the most dramatic change to their logo since 1999 and have replaced their signature serif font with a new typeface called Product Sans. (Photo by Justin Sullivan/Getty Images)
Google employee Andrea Janus demonstrates the use of the mini-putt green on the balcony at the new Google office in Toronto, November 13, 2012. REUTERS/Mark Blinch (CANADA - Tags: SCIENCE TECHNOLOGY BUSINESS)
Google Inc. logos sit on a wall inside the pantry at the company's offices in Berlin, Germany, on Friday, Aug. 16, 2013. Google, based in Mountain View, California, is seeking to revive Motorola Mobility's smartphone business, recently announcing a new flagship Moto X smartphone with customizable colors that will be assembled in the U.S. Photographer: Krisztian Bocsi/Bloomberg via Getty Images
A Google Inc. employee carries an Apple Inc. laptop computer as he walks past logos inside the company's offices in Berlin, Germany, on Friday, Aug. 16, 2013. Google, based in Mountain View, California, is seeking to revive Motorola Mobility's smartphone business, recently announcing a new flagship Moto X smartphone with customizable colors that will be assembled in the U.S. Photographer: Krisztian Bocsi/Bloomberg via Getty Images
Indian visitors sit inside a display at the 'Google House' event showcasing the company's latest product innovations for India in Bangalore on August 18, 2015. Google says its products are targeted towards the growing number of internet and smartphone users in the country. AFP PHOTO / Manjunath KIRAN (Photo credit should read MANJUNATH KIRAN/AFP/Getty Images)
An Indian visitor sits inside a display at the 'Google House' event showcasing the company's latest product innovations for India in Bangalore on August 18, 2015. Google says its products are targeted towards the growing number of internet and smartphone users in the country. AFP PHOTO / Manjunath KIRAN (Photo credit should read MANJUNATH KIRAN/AFP/Getty Images)
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This is the biggest fine for a single company in an EU antitrust case, exceeding a 1.06-billion-euro sanction handed down to U.S. chipmaker Intel (INTC.O) in 2009.

It is also the biggest regulatory setback for Google, which settled with U.S. enforcers in 2013 with a requirement to stop "scraping" reviews and other data from rival websites for its own products.

The EU competition enforcer has also charged Google with using its Android mobile operating system to crush rivals, a case that could potentially be the most damaging for the company, with the system used in most smartphones.

The company has also been accused of blocking rivals in online search advertising, with the Commission warning of deterrent fines if Google is found guilty of breaching EU rules.

(Reporting by Foo Yun Chee; editing by Philip Blenkinsop)

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