According to Google, “This feature makes it easy to see changes between two docs over time. For instance, educators can use this tool to compare essays and track revisions, saving them time when grading. On the other hand, business users can use this tool during contract negotiations to see what terms have changed throughout the negotiation process and to compare the final version of the doc to the initial version.”
The feature should be rolling out as we speak and if you use Google Docs, you should be able to access the feature by going to Tools > Compare Documents. However, in the event that you do not see the feature, then it probably means that it hasn’t made its way to you yet. Google notes that the Rapid Release domains should expect to see the feature over the next 15 days starting from the 11th of June, while the rest of the rollout is expected to commence on the 25th of June.