In a significant blow to Big Tech, the European Court of Justice (ECJ) has upheld two major rulings against Apple and Google on September 10, 2024, reinforcing the European Union’s stance on fair taxation and competition in the digital economy.The ECJ ordered Apple to pay 13 billion euros ($14.34 billion) in back taxes to Ireland, overturning a previous lower court decision. The court found that tax rulings issued by Ireland since 1991 constituted illegal state aid, allowing Apple to pay artificially low taxes. In one striking example, the court cited that an Apple subsidiary in Ireland reported profits of 16 billion euros in 2011 but paid only 10 million euros in taxes, resulting in an effective tax rate of just 0.05%.Simultaneously, the ECJ upheld a 2.4 billion euro ($2.65 billion) fine against Google for antitrust violations related to its shopping comparison service. The court confirmed that Google had abused its dominant market position by favoring its own Google Shopping service over competitors in its search results.European Competition Commissioner Margrethe Vestager hailed the rulings as ‘a great victory for European citizens and for tax justice’. The decisions are seen as a vindication of the Commission’s actions and a significant step in regulating tech giants.Both Apple and Google expressed disappointment with the rulings. Apple maintained that the case was about ‘which government we are required to pay it [taxes] to,’ while Google stated it had already made changes to comply with the Commission’s decision.These landmark rulings are expected to have far-reaching implications for the tech industry and may pave the way for further regulatory actions against large digital companies. The decisions also reinforce the EU’s Digital Markets Act, a law passed in 2022 to regulate large online platforms.
Key points
- The European Court of Justice ordered Apple to pay 13 billion euros in back taxes to Ireland.
- The court upheld a 2.
- These rulings are seen as a significant victory for the EU in its efforts to regulate Big Tech companies.
- The decisions may have far-reaching implications for the tech industry and could lead to further regulatory actions.
4 billion euro fine against Google for antitrust violations related to its shopping comparison service.
Contradictions👾Apple claims the case is about which government they should pay taxes to, while the EU asserts it’s about fair taxation and illegal state aid.
👾Google states it has already made changes to comply with the Commission’s decision, yet the court upheld the full fine.
