Swedish court rejects ‘by object’ theory in Google Ads trademark bidding case

On 4 June 2026, the Swedish Patent and Market Court delivered a highly anticipated ruling in the case between the Swedish Competition Authority (the “SCA”) and the digital healthcare provider Min Doktor. The court annulled the SCA’s decision imposing a SEK 6.5 million (approx. EUR 600,000) competition fine for an agreement between Min Doktor and its competitor Kry regarding Google Ads trademark bidding.

The case concerns a question that has attracted increasing attention from competition authorities: can an agreement between competitors not to bid on each other’s trademarks in online search advertising constitute a restriction of competition by object?

Background

The SCA found that Min Doktor and Kry had agreed to stop advertising on Google Search when users searched for the other party’s trademark. According to the SCA, the arrangement reduced competition for consumers searching for the companies’ services and therefore amounted to a restriction of competition by object under both Swedish and EU competition law.

The evidence showed that the parties had exchanged emails in early 2020 and implemented the arrangement through their respective Google Ads accounts. The court agreed with the SCA that an agreement existed and further found that the parties largely acted in accordance with it for approximately eleven months.

By way of background Kry was the leniency applicant. In addition to Min Doktor, the SCA also imposed competition fines on Doktor.se and Doktor24, both of which allegedly had bilateral arrangements with Kry. Doktor.se has appealed its fine of SEK 15 million (approx. 1,5 MEUR) and the case is still pending before the Swedish Patent and Market Court. Doktor24, however, did not appeal the decision imposing a fine of SEK 5 million (approx. 500 000 EUR).

The key issue: Restriction by object?

The decisive question was not whether an agreement existed, but whether the agreement was sufficiently harmful to competition to qualify as a restriction “by object”.

The court emphasised that the concept of a restriction by object must be interpreted narrowly and is generally reserved for conduct that experience shows to be inherently harmful to competition, such as price-fixing, market sharing or output restrictions.

Importantly, the court noted that agreements of this type, that is bilateral arrangements between competitors concerning trademark bidding in search advertising, have not previously been assessed by the EU courts. While the SCA relied on cases such as the Commission’s decision regarding Guess and the German Competition Authority’s decision regarding Asics (KVZ 41/17), the court considered those precedents distinguishable because they concerned restrictions imposed within distribution systems rather than agreements between direct competitors.

Although the court accepted that the parties objectively agreed not to compete for potential patients through a specific form of online advertising, it was not persuaded that bidding on a competitor’s trademark constituted a sufficiently important competitive parameter in the circumstances of the case. The court also found that neither the economic evidence nor the academic research presented provided a clear answer as to whether trademark bidding is inherently pro-competitive or whether restrictions on such bidding are inherently harmful to competition.

Against that background, the court concluded that there was no sufficiently solid and reliable experience showing that this type of agreement is, by its very nature, harmful to competition. As a result, the arrangement could not be classified as a restriction by object.

A procedural lesson for competition authorities

The judgment is particularly noteworthy because the SCA had pursued the case exclusively as an object restriction. Having concluded that the agreement was not restrictive by object, the court observed that it would have been necessary to analyse the agreement’s actual or potential effects on competition. However, no such effects analysis had been carried out by the SCA. This proved fatal to the case.

Key takeaways

The judgment does not establish that trademark bidding agreements between competitors are lawful. Rather, it highlights the difficulty of treating novel forms of digital conduct as restrictions by object in the absence of established experience demonstrating their inherent harmfulness.

The decision also serves as a reminder that competition authorities face a significant evidentiary burden when seeking to characterise new business practices as by object restrictions. Where the competitive significance of a practice is uncertain, an effects-based analysis may be indispensable.

Given the novelty of the issues and their relevance for digital advertising markets, the case is likely to attract attention well beyond Sweden. It may also provide important guidance for future enforcement involving online search advertising, platform ecosystems and the application of Article 101 TFEU to emerging forms of digital competition.

It remains to be seen whether the Swedish Competition Authority will appeal the judgment within the three-week deadline. At the time of writing, the SCA has stated that it is assessing the judgment and will decide whether to appeal. The Doktor.se-case is still pending. In parallel, the SCA has announced that it has prioritized an investigation concerning similar conduct by four pharmacy companies.  While the investigation initially involved seven companies, in March 2026 the SCA closed the investigation concerning three online pharmacy companies. Regardless of the next procedural steps, the decision is a significant contribution to the evolving body of case law on competition law and digital advertising markets.