In a highly anticipated ruling on Tuesday, the EU Court is set to make a decision on the 13-billion-euro tax case involving Apple and Ireland. This case, which dates back to 2016, revolves around allegations that Ireland allowed Apple to avoid paying billions of euros in taxes through special arrangements. Despite a previous victory for Apple in 2020 when the EU’s General Court annulled the tax payment order, the top legal adviser of the European Court of Justice has recommended scrapping that decision due to legal errors. If the ECJ judges decide to throw the case back to the lower EU court, Apple could potentially face the hefty tax bill.
Google’s Tax Case:
In a simultaneous ruling, the EU Court will also deliver a verdict on Google’s multi-billion-euro fine. The EU imposed a 2.4-billion-euro fine on Google in 2017 for abusing its dominant position by favoring its own Google Shopping service in search engine results. Despite Google facing multiple record fines for violating EU competition rules in recent years, the top adviser has recommended upholding the 2.4-billion-euro fine. This decision will be a crucial test for Google, as it also awaits a ruling on a 1.49-billion-euro fine next week and faces legal challenges in the US over online advertising dominance.
Legal Challenges and Regulatory Concerns:
The rulings in these tax cases will serve as a significant test for Margrethe Vestager, the EU’s outgoing competition chief, who has faced setbacks in defending the bloc’s tax enforcement moves. With previous cases lost against tech giants like Amazon and Starbucks, the EU is seeking a definitive victory in the Apple and Google cases. The legal scrutiny on Google is not limited to the EU, as the company also faces antitrust allegations in the United States over its online advertising practices. Regulators are particularly concerned about Google’s ad tech operations and the company’s alleged abuse of dominance in the online ad market. The EU has recommended Google to sell part of its ad services to ensure fair competition, and investigations into anti-competitive practices by Google are ongoing in the UK as well.
The decisions to be handed down by the EU Court in the Apple and Google tax cases will have far-reaching implications for the tech giants and regulatory authorities on both sides of the Atlantic. As the legal battles continue and the scrutiny on tech companies intensifies, the outcomes of these cases will shape the future of tax enforcement and competition regulation in the digital age.