The European Union’s top court is set to make a crucial ruling on Tuesday regarding a 13-billion-euro tax case involving tech giant Apple and Ireland. This decision will be a significant test for Margrethe Vestager, the outgoing competition chief of the EU, who has faced numerous setbacks in EU courts in relation to her previous decisions. The Apple case, dating back to 2016, revolves around the European Commission’s claim that Ireland provided favorable tax treatment to Apple, enabling the company to evade paying billions of euros in taxes.
In 2020, the EU’s General Court ruled in favor of Apple by annulling the order for the company to repay the taxes owed. However, the top legal adviser of the higher European Court of Justice recommended overturning that decision due to legal errors. Now, the ECJ judges are tasked with deciding whether to send the case back to the lower EU court, potentially resulting in Apple having to pay the 13-billion-euro tax bill. This case is one of the most high-profile legal battles between the European Commission and major tech companies over tax arrangements.
Google Fine Case
In addition to the Apple tax case, the EU court will also be ruling on a multi-billion-euro fine against Google. The European Commission imposed a 2.4-billion-euro fine on Google in 2017 for abusing its dominant position by favoring its Google Shopping service in search engine results. After a top adviser recommended upholding the fine, the court is expected to deliver a final decision on Tuesday.
Google has faced several fines from the EU for violating competition rules, with record fines totaling around eight billion euros between 2017 and 2019. The company is also awaiting a decision on a 1.49-billion-euro fine from the top EU court next week. The legal challenges for Google extend beyond Europe, as the US government recently initiated a trial accusing Google of online advertising dominance and anti-competitive behavior.
Google’s ad tech practices, which determine online ad placements and costs, have raised concerns among regulators globally. Last year, Brussels accused Google of abusing its dominance in the online ad market and suggested that the company divest part of its ad services to promote fair competition. The UK competition watchdog also found Google guilty of anti-competitive practices in online advertising following a two-year investigation.
Overall, the upcoming EU court rulings in the Apple and Google cases will have significant implications for tax enforcement and competition practices in the tech industry. These decisions will shape the future of regulatory oversight for major tech companies operating in the EU and beyond.
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