EU deals blow to Apple, Google

Five years ago, in September 2019, I covered a marathon hearing before the EU General Court, in which Apple ?? and the Republic of Ireland were contesting the European Commission's 2016 decision to order the tech giant to return EUR 13bn to Ireland it owed because it had paid unfairly low taxes. ?? In its judgment a few months later, the General Court ? annulled the Commission's decision, finding that the EU agency had not proven an unfair tax advantage. But today, the European Court of Justice ???? has sided with the Commission: Ireland granted Apple unlawful state aid that the country has now to recover. Big win for the Brussels officials ? Full judgment here ?? https://lnkd.in/eeNSxya3 (picture: corridors of the EU courts from the time I spent many hours inside)

????????????’?? ?????? ?????????? ?????????????? ?????????????? ?????????? '?????? ????????????????': ???????? Europe's highest court concluded a decade-long legal battle by ruling that #Apple must pay €13 billion ($14.4 billion) in back taxes to Ireland. The charge, estimated to be around $10 billion, is expected to substantially increase Apple's effective tax rate for the quarter. see more here -> https://lnkd.in/ef6RwhdM According to the company's 8-K filing, this could result in approximately a 10% impact on its earnings per share for the fiscal year 2024. The company had already placed €12.7 billion, including interest, into an escrow account by September 2023. These funds were set aside and restricted from general use until a final decision was reached on the tax case. "Apple generated ~$100Bn free cash flow in FY2023 and we view the news as not material to our thesis," Citi analyst Atif Malik said in a note. "This has been a long, drawn out case and the final impact while not ideal, does not impact our fundamental valuation of Apple," Amit Daryanani, CFA added.

Apple was supposed to win its case before the Court of Justice of the European Union, but it didn't. Here is why: In a quick reading of the decision published today, the two main arguments brought up by the ECJ to decide against Apple and in favour of the European Commission are as follows: ?? Apple was supposed to win the case due to a wrongly built reference framework to identify illegal state aid. The ECJ repeatedly stated in previous decisions (Fiat, Amazon) that to derive an arm's length standard from Article 107 TFEU itself (the provision prohibiting State aid in the EU) is contrary to law. In the Apple decision, that argument did not play a role because neither Ireland nor Apple raised it before the ECJ (para. 276). ?? The Commission has demonstrated that the tax rulings granted by Ireland to Apple's subsidiaries entail favourable tax treatment in comparison to (para. 305): ? non-integrated standalone companies ? integrated group companies that carry out transactions with third parties, or ? integrated group companies that carry out transactions with group companies with which they are linked by ?xing the price of those transactions at arm’s length In a piece that will be published soon in Common Market Law Review, my colleague Hugo López and I build a systematic framework to assess the main arguments of State aid cases against the tax profit allocation of multinational's profits, including an assessment of the arguments in the Apple case. #EU #EULaw #StateAid #Apple #EUCommission

Apple just lost a major tax battle with the EU, and will now have to fork over more than $14 billion in back payments to Ireland. ? Ireland's favourable tax system had encouraged a number of Big Tech companies to set up shop there, as it allowed multinationals to cut their overseas contributions to single digits. ?? But a final ruling from the European Court of Justice means Apple will be feeling the pinch from a now-abandoned "sweetheart deal". ?? All this and more explained in my latest for Reuters below:

#ECJ: Judgment in Case C?465/20?- Tax rulings: the Court of Justice sets aside the judgment of the General Court concerning tax rulings issued by Ireland in favour of Apple ---- #CJUE: Arrêt dans l’affaire C?465/20?- Tax rulings?: la Cour annule l'arrêt du Tribunal concernant les rulings fiscaux adoptés par l’Irlande en faveur d’Apple

Coupled with Google’s failure to evade its EU fine, this is a victory for capitalism. Now, some might go “what, are you kidding?”. The answer is no. Capitalism is about competition, not allowing monopolies to do whatever they want. Big business and big government is what happens in kleptocracies, not democracies. The DMA is a blueprint for empowering every country to put an end to the abuse of corporate power.

?? ?? ???????????????? ?????????????? ?????? ?????? ???? ???????????????????? ?????? ?????? ???????????? ???? ???????????????????? ???????????? ?????????? & ???????????? ! ?? Today marks a monumental success for the European Commission and especially Margrethe Vestager. Thanks for all your efforts in the past and future. This decision marks also a new futurechance for Comparison Search Site (CSS) providers. After more than 14 years of rigorous legal battles, the Court of Justice of the European Union has upheld the €２．４ ｂｉｌｌｉｏｎ fine imposed on Google for abusing its dominant position by favoring its own comparison shopping service over competitors. ?????? ??????????????????: ? ???????????????? ????????????????: The Court of Justice upheld the fine, reinforcing the importance of fair competition in the digital market. ? ?????????? ???? ??????????????????:Google was found to have favored its own comparison shopping service, disadvantaging competitors. ? ???????? ?????????? ????????????: This judgment concludes over 14 years of legal proceedings, setting a significant precedent. ? ???????????????? ????????????????????: The decision underscores the EU’s commitment to protecting consumer choice and fostering innovation. ? ?????????????? ??????????: ?????????????? ?????????????? ?????? ? This judgment comes at a pivotal time as the EU’s Digital Markets Act (DMA) is set to reshape the digital landscape. The DMA aims to create a fairer and more competitive environment by regulating the practices of large digital platforms. Opportunities for Collaboration: ???????? ??????????????????????:The DMA provides a framework to ensure that all market participants, including giants like Google, compete on a level playing field. Innovation and Growth: By fostering fair competition, the DMA encourages innovation and growth across the digital economy. ???????????????? ????????????????:A fairer market means more choices and better services for consumers. Congratulations to everyone involved in this landmark case! This is a victory not just for the EU Commission, but for all who were fighting for fairer competition and transparency in the digital economy. Together with the DMA, we have a unique opportunity to create a fairer yet competitive environment for all in close colaboration with Google to create good #UserExperience on the Google Search #EUCommission #CompetitionLaw #DigitalMarket #CSS #FairCompetition #Innovation #ConsumerProtection #DigitalMarketsAct #DMA #PriceComparison

Tech Tuesday! Apple and Google lose their separate appeals in cases before the European Court of Justice. Apple must now comply with an EU order for Ireland, which must collect € 13 billion in unpaid taxes from Apple. https://lnkd.in/evbPWMxs In the Google case, the court agreed with the Commission's decision from 2017 to fine Google € 2.4 billion relating to antitrust issues regarding Google's price-comparison shopping services. https://lnkd.in/eqP298WY These cases have been dragging on for quite some time. When initiated, they marked a shift from a governmental 'hands-off approach' to more aggressive scrutiny of tech companies. Their extended duration however raised questions whether regulators and authorities can keep pace with the fast-moving sector.

Google have had to pay a lot in fines in recent years! Hopefully, this will lead to fairer practices in the future.

A VICTORY FOR SMALL TECH – final judgement; Google loses appeal against 2017 Shopping fine ?? Google must pay the €2.42bn fine issued by the European Commission in 2017 for abusing its dominant position by self-preferencing its own comparison shopping service. The Court of Justice of the European Union announced its final decision on the #GoogleShopping Case this morning. Google cannot re-appeal. Kelkoo Group CEO Richard Stables said: “Today is a victory for #smalltech and businesses like mine – and for everyone who believes in consumer welfare. We have waited seven long years for Google to exhaust the appeals process and it’s taken 14 years in total to get legal certainty. Google’s repeated appeals and failure to change its #selfpreferencing practices show its disdain for the very people it claims to be creating services for – consumers who have lost out on choice and the best deals in #Shopping for over a decade, exacerbated by the cost-of-living crisis – and small businesses like mine have been crushed. Today is also vindication for the European Commission. "The ruling reinforces the precedent that “self-preferencing” by dominant digital platforms constitutes a violation of EU competition law, as well as under the Digital Markets Act (DMA) and marks a tougher stance on all future antitrust investigations. Today’s win should help the Commission achieve its objective of a level playing field in digital markets under the #DMA which is a nimble and fast-acting regulatory tool." The CJEU decision follows the recent landmark US antitrust case about Google’s dominance in Search; it lost the case and presiding judge Mehta ruled that “Google is a monopolist and has acted as one to maintain its monopoly.” #CSSs #antitrust #Googleshopping #comparisonshopping #ecommercebusiness #searchengines