Commission Seeking Declarations That Agreements Not To Bid On Google Ads Breach Commerce Act
The Commerce Commission has filed proceedings at the High Court in Christchurch seeking declarations that consumer loan provider Moola engaged in cartel conduct relating to online advertising on Google Ads.
The Commission alleges Moola reached agreements with other consumer loan providers that they would not bid on each other’s brand names on Google Ads. The Commission also alleges agreements were reached that the companies would negatively match certain keywords. This means that consumers searching for a consumer loan provider on Google may not see ads for other loan providers.
The Commission considers these agreements fixed, controlled or maintained the price paid by Moola for its online advertising on Google Ads and prevented, restricted or limited the purchase of online advertising on Google Ads. As a result, the Commission alleges, entering into and giving effect to the agreements breached the Commerce Act.
The Commission is not seeking a pecuniary penalty in this proceeding.
As this case is before the Court, the Commission cannot comment further at this time.
Search results on Google include both organic search results and paid advertising results through Google Ads.
Google Ads is an online advertising platform offered through the Google search platform. Companies can pay to display their products and services as an advertisement in response to a search for a particular word or phrase. The display ranking of an advertisement and the amount paid by the advertiser to Google Ads is determined by a live second-price auction or spot market.
Negatively matching keywords prevents certain ads from being triggered by a certain word of phrase, meaning certain ads will not display to anyone who is searching for that word of phrase.