Google Hit With $55 Million Penalty for Anti-Competitive Conduct: What Australian Businesses Can Learn

This article is based on an official media release published by the ACCC on 2 December 2025. Bane Legal Services is not a law firm and does not provide legal advice. We are your trusted legal matchmaker helping business owners find the right commercial lawyer when they need one.

New digital competition rules could reshape how search and AI tools operate in Australia.

When competition laws are breached in Australia, the consequences can be swift and expensive. The latest example is Google Asia Pacific, which has been ordered by the Federal Court to pay $55 million in penalties for engaging in anti-competitive conduct involving exclusive search engine arrangements with Telstra and Optus.

According to the ACCC, Google reached “understandings” with the two telcos that ensured Google Search was the only search engine pre-installed on Android phones sold to consumers between December 2019 and March 2021.

In exchange, Telstra and Optus received a share of Google’s advertising revenue generated from user searches on those devices.

Why the Court Found the Conduct Anti-Competitive

Google admitted to the conduct and cooperated with the ACCC during the proceedings. The Court found that the arrangements had the likely effect of substantially lessening competition, which is prohibited under Australian competition law.

ACCC Deputy Chair Mick Keogh emphasised the seriousness of the breach:

"This penalty should send a strong message to all businesses that there are serious and costly consequences for engaging in anti-competitive conduct."

He reinforced that Australia’s market economy relies on fair competition not exclusive deals that lock out rivals.

Telstra, Optus and TPG: Court-Enforceable Undertakings

Although the telcos were not parties to the Court proceedings, they previously provided court-enforceable undertakings to the ACCC. Under these commitments, Telstra, Optus and TPG agreed that they would not enter into or renew exclusive arrangements with Google requiring Google Search to be the default or only pre-installed search engine on Android devices.

Importantly, these undertakings:

• allow the telcos to configure search services on a device-by-device basis

• permit agreements with other search providers, including emerging AI-driven search tools

• give manufacturers and telcos more freedom to diversify default services

Combined with Google’s own undertaking, these measures open the door to greater search choice for millions of Australians.

A Big Step Toward Digital Competition in Australia

The ACCC has flagged competition issues in the digital economy as one of its ongoing enforcement priorities.

This case sits within a broader regulatory push arising from the ACCC’s five-year Digital Platform Services Inquiry, which recommended major reforms to address the dominance of large tech platforms, particularly in areas such as:

• default service settings

• exclusive pre-installation agreements

• digital advertising markets

• transparency and consumer choice

The Federal Government is consulting on a proposed digital competition framework that would empower the ACCC to introduce mandatory service-specific codes for designated platforms including giants like Google.

What This Means for Australian Businesses

For franchisors, retailers, tech developers and any business relying on digital distribution channels, this case is a timely reminder:

• Exclusive agreements that restrict consumer choice can carry major competition risks.

• Contracts with tech platforms should be carefully reviewed to ensure compliance with the Competition and Consumer Act.

• Digital markets are firmly in the ACCC’s spotlight, particularly where default settings limit competitors.

Businesses large and small should expect increased scrutiny of digital ecosystems, especially arrangements involving platform dominance, data control or default software installations.

If your business has distribution, licensing or digital platform agreements and you’re unsure about the competition law implications, professional legal advice is essential.

Need Help Finding the Right Competition or Commercial Lawyer?

Bane Legal Services is not a law firm and does not provide legal advice.

But with more than 30 years of business experience, we specialise in helping business owners connect with the right commercial, competition or technology lawyer for their situation.

If you’d like to be matched with a lawyer who understands the ACCC’s expectations and how to stay compliant we’re here to help.