China Fires Antitrust Volley At Google Amid Looming US Trade War

Google is no stranger to antitrust allegations in numerous countries, including the US. In what may be termed a tit-for-tat, the Chinese government has initiated an investigation into Google amidst claims of antitrust practices, following the US decision to impose a 10% tariff on goods from China.China, alongside Mexico and Canada, was slapped with various tariffs by the US Trump administration that are set to take effect today. However, while Mexico and Canada have managed to avoid the tariffs— albeit temporarily—China is left to contend with an additional 10% tariff on imported goods into the US.Google appears to be caught in the crossfire between these two economic powerhouses as a result. The tech giant’s operations in China have been under intense scrutiny and controversy for years, leading to the eventual closure of its search engine service in 2010. Nonetheless, the company still maintains a presence in the country, focused on advertising that enables Chinese companies to reach audiences beyond their home market. On Tuesday, the Chinese State Administration for Market Regulation commenced an inquiry into allegations that the tech giant violated anti-monopoly laws without providing specifics about the violations.The tech company has long faced complaints such as monopolizing search and advertising services, securing exclusive agreements to shut out competitors, distorting ad auction competition, and manipulating auctions. According to John Gong, a professor of economics based in China, the investigation may be related to Google’s dominance with its Android business, which ensures that most smartphone manufacturers pay for the right to use its Android OS on their devices.While there may be legitimate concerns, China targeting Google and other companies at this time may suggest they are pawns in a broader geopolitical struggle. This move may be China’s way of signaling to the US that it will not passively stand by while the US continues to impose tariffs.While the investigation is still in its early stages, its outcome is unlikely to impact Google significantly, as it generates only about 1% of its global sales from China. Whether this action will lead to a complete end of Google’s operations in China remains to be seen, however.