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Apple and Google were both handed separate defeats Tuesday in their defenses against the European Union's efforts to rein in the dominance of major tech firms.
The EU's top court, the European Court of Justice, sided with the bloc's executive arm, the European Commission (EC), in a case that requires Apple to pay some $14 billion in back taxes to Ireland. The high court also upheld a $2.7 billion fine against Google for alleged antitrust violations.
Apple Inc. signage at the company's Fifth Avenue store in New York City is seen on May 15. (Michael Nagle/Bloomberg via Getty Images / Getty Images)
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AAPL | APPLE INC. | 228.52 | -0.48 | -0.21% |
Apple, Inc.
In 2016, the EC ordered Apple to pay 13 billion euros ($14.4 billion) in back taxes to Ireland, claiming that the iPhone maker benefited from two Irish tax rulings for over two decades that artificially reduced its tax burden. Both Apple and Ireland appealed the ruling, which was annulled in 2020, but the EC appealed that decision and won the final ruling on Tuesday.
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Apple said in a statement it was disappointed by the ruling.
"This case has never been about how much tax we pay, but which government we are required to pay it to," the statement read, in part. "We always pay all the taxes we owe wherever we operate and there has never been a special deal."
The Google logo is seen on the Google house at CES 2024, an annual consumer electronics trade show, in Las Vegas on Jan. 10. (Reuters/Steve Marcus/File / Reuters Photos)
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GOOG | ALPHABET INC. | 169.24 | -8.09 | -4.56% |
Alphabet, Inc.
The case against Alphabet-owned Google stems back to 2017, when the EC issued a fine against the world's largest search engine for using its own price comparison shopping service to gain an allegedly unfair advantage over smaller European rivals.
A lower tribunal had endorsed the EU competition enforcer's decision in 2021, prompting Google to appeal. In siding with the EC on Tuesday, the judges on Europe's high court determined that EU law does not sanction the existence of a dominant position, but its abusive exploitation.
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"In particular, the conduct of undertakings in a dominant position that has the effect of hindering competition on the merits and is thus likely to cause harm to individual undertakings and consumers is prohibited," they said.
Google expressed disappointment over the ruling. A spokesperson told The Wall Street Journal, "This judgment relates to a very specific set of facts. We made changes back in 2017 to comply with the European Commission’s decision."
The EU's antitrust chief, Margrethe Vestager, took a victory lap over the rulings against the American tech giants on social media.
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In separate posts on X on Tuesday, Vestager called the Apple ruling "a huge win for European citizens and tax justice," and the Google decision "a big win for digital fairness."
Reuters contributed to this report.