Google has faced numerous antitrust allegations over the years from various regions across the world that it operates in. However, it looks like the company is now facing those allegations over in China. The Chinese government has recently announced it is launching investigation into Google for alleged antitrust violations. The State Administration for Market Regulation is accusing Google of violating China’s anti-monopoly law. This actually wouldn’t be the first time Google has faced antitrust allegations. However, the timing of this probe seems suspect and doesn’t come across as coincidental as one might think.
China’s retaliation
According to the government’s statement (machine translated), “Because Google is suspected of violating the Anti-Monopoly Law of the People’s Republic of China, the State Administration for Market Regulation has initiated an investigation into Google in accordance with the law.”
Unfortunately, no further specifics were provided. In a way it’s kind of strange because Google’s presence in China is next to zero. Most of the company’s products and services are banned in the country, except for Android, which powers the majority of phones produced by local Chinese manufacturers.
However, it’s not that hard to see that the probe could be nothing more than a thinly veiled attempt at retaliation against recent US policies. US President Donald Trump recently put into effect a 10% tariff on imports from China.
China has since responded with tariffs of its own. This includes a 15% levy on coal and liquified natural gas, and an additional 10% duty on American crude oil, farm equipment, and certain cars and trucks. The inclusion of energy and agricultural products is particularly significant. This is because these sectors are deemed critical to US exports and could hurt the country economically if the tariffs were to discourage Chinese companies from buying goods from the US.
Ongoing tensions
This antitrust investigation in Google is just part of the ongoing trade war between the US and China. Over the years, both nations have imposed tariffs and launched investigations into both US and Chinese companies. Some of you might recall that Huawei was one of the casualties of this trade war. As a result, Huawei found itself on the US Entity List.
This forbade the company from doing business with US companies and restricted access to key pieces of technology. This included semiconductor manufacturing technology, which significantly slowed down Huawei’s progress on its Kirin chipsets.
More recently, TikTok has come under fire. TikTok, a popular app owned by ByteDance, a Chinese company, faced a potential ban by the US government. However, Trump stepped in at the very last minute and gave the app a 75-day extension.
It remains to be seen how Google plans on resolving this antitrust probe by China. However, we expect that things will get messy as long as both the US and China continue to escalate their trade war against each other.
