The European Union’s top court is set to rule on Tuesday in a high-profile 13-billion-euro tax case involving tech giant Apple and Ireland. Additionally, the court could also make a decision on upholding a multi-billion-euro fine against Google, marking a crucial moment for the bloc’s competition chief, Margrethe Vestager.
The Apple case stems from a legal battle that began in 2016 when the European Commission accused Ireland of granting the iPhone maker special tax privileges, allowing it to evade billions of euros in taxes. This case is part of a broader investigation into sweetheart tax deals between prominent companies and various EU countries. In 2020, Apple won a victory in the General Court, which annulled the order for the tech giant to pay the taxes. However, the top legal adviser of the European Court of Justice recommended overturning that decision due to legal discrepancies. Now, the ECJ must make a final ruling on whether Apple should pay the 13 billion euros to Ireland.
The Google Case
In the case of Google, the EU handed down a 2.4-billion-euro fine in 2017 after finding that the tech giant abused its dominant position by favoring its own Google Shopping service in search engine results. A top adviser has recommended upholding this fine, signaling a potential victory for the European Commission. Google has faced a series of fines for violating EU competition rules in recent years, totaling around eight billion euros. The company is also awaiting a decision on another fine worth approximately 1.49 billion euros next week. Moreover, Google is under scrutiny in the United States for allegedly monopolizing online advertising, with a trial currently ongoing in the US.
Google’s ad tech practices have come under scrutiny by regulators worldwide, including in the EU and the UK. Brussels has accused Google of abusing its dominance in the online ad market and recommended divesting part of its ad services to ensure fair competition. The UK’s competition watchdog recently concluded that Google engages in anti-competitive practices in online advertising after a thorough two-year investigation.
The upcoming rulings from the EU court on the Apple and Google cases will have significant implications for both tech companies and regulatory authorities. These decisions will shape the future of tax enforcement and competition in the digital landscape, setting precedents for similar cases in the EU and beyond. The outcomes of these cases will not only impact the financial liabilities of Apple and Google but also influence how tech giants conduct business and comply with competition regulations globally.
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