Google and Fitbit proudly announced yesterday that their $ 2.1 billion acquisition was completed after months of regulatory scrutiny. Unfortunately for the deal, however, it could still face legal issues, as Google did not wait for the approval of the US Department of Justice (DOJ) or Australian regulatory authorities before the Fitbit buyout was completed.
Between the November 2019 announcement and the apparent closure of yesterday, Google has faced several investigations into the deal. The most important of these was from the EU, which granted approval at the end of December. The DOJ also conducted ongoing investigations, but never gave Google approval before yesterday’s announcement.
Ryne Hager van Android Police figured out how Google managed it. The DOJ only had a specific period to approve or reject the agreement, but the period expired without a final response. As a result, Google simply went ahead given the lack of yes or no. At this stage, it is unclear whether the US DOJ will take any legal action against Google and Fitbit.
A Google spokesman said of the DOJ investigation:
We have complied with the extensive review of the DOJ over the past 14 months, and the agreed waiting period has expired without their objection. We keep in touch with them and are committed to answering any additional questions. We are confident that this agreement will increase competition in the very pressing drama market, and we have entered into commitments that we plan to implement worldwide.
Where Google really jump the gun was in Australia. There, the Australian Competition and Consumer Commission is still conducting an ongoing investigation into the deal, which is expected to close in March this year. The ACCC cited competition issues as the reason for the attempt to block the deal, and was concerned that Google would “express” Fitbit’s competitors. Of course, the statement has in fact ignored the monopoly that Apple has over the iOS portable market.
At this stage, the ACCC is investigating a ‘enforcement investigation’ that could lead to legal action over the Fitbit and Google agreement.
Since the transaction was completed on January 14, 2021, before the ACCC completed its investigation, this case became an investigative application of a completed merger. No further updates on the investigation will be made in this public register.
In a statement to Android Police, the ACCC further states:
“The decision by Google to complete the acquisition of Fitbit before we have completed our merger investigation means that we are now conducting an investigation. As a result, and depending on the results of our investigation, we will consider taking legal action on this matter, ”said ACCC Chairman Rod Sims.
In December, the ACCC decided not to accept a long-term behavioral venture offered by Google to address competition issues due to the significant difficulties in effectively monitoring and enforcing the company’s compliance.
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