Will Google Deduct the Penalty from Advertisers?

Will Google Deduct the Penalty from Advertisers?
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Following the administrative fine of 196 million 708 thousand 54.78 Turkish lira imposed by the Competition Board on Google yesterday, attention has turned to what move Google will make next. So, will Google deduct the penalty from advertisers?

Ramazan Becer, Chairman of CRM Media Management Board, who claims that such penalties greatly affect advertisers, stated, “Since November 1st, Google has already been charging a 5% legal processing fee from advertisements published in Turkey. With this 5%, they were also covering the fines. Such penalties cause a decrease in advertisers’ advertising budgets, thus reducing revenues,” he said.

The investigation into Google Reklamcılık ve Pazarlama Ltd Şti, Google International LLC, Google LLC, Google Ireland Limited, and Alphabet Inc for “abusing its dominant position in the general search market” was completed yesterday. Accordingly, the Competition Board concluded that Google violated the Law No. 4054 on the Protection of Competition by making it difficult for organic results that do not bring in ad revenue by prominently and intensively displaying text ads with uncertain ad nature at the top of general search results, thereby hindering its activities in the content services market.

Competition Board imposes $197 million fine on Google

Within this scope, the Board decided to impose an administrative fine of 196 million 708 thousand 54.78 Turkish liras on the mentioned enterprise. Emphasizing that Google is a global platform, Becer said, “Google does not make decisions based on countries. Since every decision it makes will bind all countries, it does not step back.” Stating that if Google opens an office in Turkey, it will set a precedent for other countries, so it will not start such a practice, Becer said, “If it pays income tax in Turkey or, to put it bluntly, surrenders, it will have to apply the same practice to all countries, so I believe this tension will not end.”

“The 15% withholding tax is also paid by advertisers”

Becer noted that the 15% withholding tax imposed because Google does not open an office in Turkey is also deducted from advertisers, saying, “Google does not suffer any harm from these sanctions. 15 liras of a 100 lira advertisement is withheld as tax, and 5 liras is deducted as a legal processing fee from the advertisement. Thus, advertisers’ budgets are reduced.” Pointing out that there are millions of institutions and individuals advertising on social media channels, both domestically and internationally, Becer said, “Advertising budgets are being cut. When budgets are cut, revenues decrease. In this way, it becomes more difficult for our country to grow.

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