Apple will have to repay 13 billion euros in back taxes to Ireland for having benefited from undue advantages, while Google will pay Europe a fine of 2.4 billion for anti-competitive practices. This is the final result of two long-running legal cases, in which the European Court of Justice (ECJ) finally ruled in favor of the European Commission against the two GAFA.
The “Apple” case dates back to 2016 when Brussels ordered the manufacturer of the famous iPhone to reimburse Ireland 13 billion euros, i.e. the profits from favorable tax treatment between 2003 and 2014. Apple had repatriated all of its revenues earned in Europe (as well as in Africa, the Middle East and India) to Ireland, a European country with favorable taxation. In 2020, the European justice system had first annulled the Commission’s order at first instance, a resounding slap in the face for the institution. The commission then decided to appeal to the CJEU.
A real “great victory for European citizens”, Competition Commissioner Margrethe Vestager said on Tuesday. “This is a victory for the (European) Commission. It is also a victory for a level playing field and for tax justice,” she said at a press briefing in Brussels.
New twist in November 2023: in a non-binding opinion, but generally followed by the judges, the Advocate General Giovanni Pitruzzella had challenged Apple’s victory. On September 10, 2024, the Court “rules definitively on the dispute and confirms the decision of the European Commission of 2016: Ireland granted Apple illegal aid that that State is required to recover,” it explains in a press release.
Google under fire for anti-competitive practices
In the “Google” case, the judges confirmed a fine of 2.4 billion euros, for having “abused its dominant position by favoring its own product comparison service”. It is in fact a fine imposed on the Mountain View group in 2017 that is confirmed, after the rejection of the appeal filed by Google. Concretely, Google is accused of having favored its price comparison service Google Shopping by making its competitors practically invisible to consumers. It was forced to modify the display of its search results in order to comply with European requirements.
The case began in 2010 with the opening of an investigation by Brussels following complaints from competitors. This case is one of the major disputes opened by Brussels against Google, which holds the record for the two largest fines ever imposed by the European executive for anti-competitive practices. While the 2.4 billion fine for Google Shopping was a record amount at the time it was imposed, it was surpassed in 2018 by another of 4.3 billion, sanctioning an abuse of a dominant position by the Android operating system for mobile phones.
In total, Google has been fined more than €8 billion for various antitrust violations in Europe. The group is now also in the crosshairs of the United States and the United Kingdom. Since Monday, it has been facing its second major trial in less than a year against the American government, which also accuses it of stifling competition in online advertising. On Friday, the British competition authority, the CMA, also accused Google of abusing its dominant position in the same advertising market, which represents its main source of income.