This one frustrated me to read, i think they should have gotten involved sooner and worked with google. Instead they slap a crazy high fee for something that is vague in violation. It does feel a bit like a vendetta here by the EU.
In most (all?) other fields of law you are expected to abide by the rules as they are stated, or risk being punished by the legislative powers. That's not a vendetta, that's law as it is most commonly practiced.
I don't see why EU should "work with google" to make them follow regulations (EDIT: beyond the threat of punishment).
The problem is that antitrust laws like these are very selectively enforced. Selection and prosecution of these cases is hence inherently political as these are non-standardized arguments or verdicts.
The ones I know about have all been the result of a complaint made by competitors. I would be surprised if the regulator could selectively reject such complaints without good reason.
That is a fair point, but isn't it built into this particular field?
We can prosecute equally for jaywalking, but anti-competitive behavior gets worse the bigger the offender is and/or the worse offense they commit. So in that way it makes sense to prosecute "top-down", that is go after the biggest ones first.
That's at least what I prefer as an EU member state citizen and consumer.
Not only does it get worse the bigger the offender is; in law, generally there are specific actions that you're not allowed to take iff you're dominant in the market.
> The problem is that antitrust laws like these are very selectively enforced. Selection and prosecution of these cases is hence inherently political as these are non-standardized arguments or verdicts.
Following that logic, the same applies to law in general. Should we therefore abolish law?
I'm guessing that they did, and probably came to the conclusion that they'll make more money than the fine that gets imposed. I wonder if they were right?
I kind of felt the same about the Apple Tax / Irish Revenue Commissioners thing.
On looking into the judgement however it appeared as though both parties actively sought to subvert competition rules under a disingenuous "veil of ignorance". Warning shots had been fired earlier but the practices continued hence the fine.
I haven't read into the details of this judgement yet but you may well find similar reasoning therein.
That's not a fine against Apple, it's a demand that Ireland corrects past behaviour that has been deemed state aid.
While it's certainly Apple's prerogative to play EU states off against each other to get the best deal, it should have been blindingly obvious that what it was getting from Ireland would be, and should be reversed.
The EU's demand was that Ireland collect that tax from Apple.
And blindingly obvious to Apple, the benefactor.
When somebody says, "Hey come and do your stuff here, we'll only charge you 0.005% corp tax!" you should expect that their wider financial governing body (who is losing out severely because of a deal like that) might have something to say about it.
You think it was blindingly obvious to Apple that they would have had to pay this tax eventually? Seems to me and everyone else it was an attempt at a stroke. You're alleging that Apple were a passive actor.
You saw that thing in the ICIJ Jersey papers leak where Apple went round the world actively seeking jurisdictions that would twist their tax rules to suit them?
No, I'm not alleging Apple was passive here, at all
I'm saying that when you get a deal this good —however you ended up there— you should not be surprised when it turns out that it was illegal.
Of course Apple shopped around. But if somebody offered to sell you $20 bills for half a cent each, would you suspect something dodgy? That's the scale of the issue here.
Apple should be forced to pay back 10x what they gained in this illegal deal.
It's bleedingly obvious that it's illegal to be taxed differently than other companies. Paying back €13bn is nothing.
Companies that "make deals" on tax anywhere in the world should be effectively banned from the EU market. It's pure evil. Or pay 10x of any gain they have made anywhere in the world by "making deals" on tax, thereby undercutting fair competition in a free market.
Playing states against each other is par for the course in the US. Each state can offer wildly different tax structures and incentives, and they all do, because each wants to be the state government that oversaw "6000 new jobs". They've seen similar issues with the collection of sales tax, when one company can "operate" over many state lines.
But saying "hey, that's obviously corruption" isn't enough. We need a good way to restructure tax collection so that the right people get it.
Multinationals paying Luxembourg (Paypal, eBay) or Ireland (Apple, Amazon) for all revenue and operations from the entire EU is wrong, no? How do you fix that?
There is literally a "world" of difference between a collection of trade-aligned sovereign nations, and a single nation of autonomous economic regions. As you mention, it's an accepted part of daily business in the US but everybody pays taxes to the Fed at the end of the day. All governed by the same congress, president, and a coherent political dialogue throughout. That's not to say it'll always remain so.
The particular problem with the EU is that it's a system of "good faith" agreements that has until quite recently been quite weak against cynical attacks.
This kind of dealing undermines the spirit of the EU accords and you can expect it to be dealt with in the course of time - probably through tax harmonisation, which wouldn't then be a million miles away from the american model.
It's bleedin' blindingly obvious that this is all a matter of corporate strategy. Yeah they should be fined for sure, but as many are keen to point out they keep to the letter of the law. That's not to say the EC couldn't enact some kind of retroactive legislation but that wouldn't be likely as they have their own "special interests" to look after too ...
This is just a drop in the ocean for the total amount of wealth that is protected with these schemes. In the $20 for ¢0.5 picture this probably amounts to ¢50. They're still making off with the other $19.49. Though arbitration would probably round that up.
Though tax avoidance was a corporate strategy and they actually sought these deals it would not have been obvious that this was technically illegal. The Irish Revenue Commissioners told them it was legal as an interpretation of Irish law, which was incorrect.
> While it's certainly Apple's prerogative to play EU states off against each other to get the best deal
It certainly IS NOT. When Apple "get's a deal" it is by definition market manipulation. You're not supposed to "get a deal" regarding taxation!
The same taxation rules must apply to every company or else there is illegal subsidy. The whole idea around "making a deal" on tax is horrendous anti-capitalist BS.
It's exactly the same as "making a deal" wrt the law in a corrupt country. A corporation "making a deal" by having government look away when they do something illegal, or getting their competitors fined on dubious charges.
Apple, Google, Microsoft, and basically all of those companies ARE THE SCUM OF THE EARTH for not refusing do to business with the market-corrupting Irish Republic.
> i think they should have gotten involved sooner and worked with google.
You are assuming that Google is a poor layman that is accidentally breaking laws. Indeed Google has an army of lawyers and they know precisely well the risk of their actions.
The law may be the law but you still need someone to complain to the authorities.
If I went out into the street and 'keyed' someone's status symbol car then I would not be in trouble until someone decided to do something about the crime.
The owner might not be pleased and, pressured by the insurance company, might get the police to go through CCTV and finally find me caught in the act.
Alternatively, a neighbour or passer by might just call the cops on me whilst I 'brazenly commit the deed'.
Either way, unless there is a report of wrong-doing then I would be getting away with it, not having to be fined etc. The police don't just sit there idly looking through the rule book looking what they can nick me for, someone would have to bring matters to their attention.
And that is the problem with this EU ruling. Nobody I know has bought a phone, decided to write to their MP (or MEP) and complained about not having Bing! as their default search engine. The EU don't accept complaints from little people like that anyway.
So what has gone on here is that some group of lobbyists have sought out some money from the Microsofts of this world, invariably to setup some fake pressure group, to bring on this legal action. With previous history, e.g. bundling in Windows, the modus operandi was the same, albeit with Netscape being the whinging ninnys.
Whwn the story finally hits the press the parasitical legal firm, the fake consumer group and who fronted the cash to pay for the action get forgotten, instead debate concerns whether the E.U. is a load of rubbish, being as silly as when they banned bent bananas and had wine lakes or whether Google have been truly evil.
In The Emperors New Clothes the people that sold the expensive invisible thread leave the story so in the final act there is just the stupidity of the crowd and the stupidity of the Emperor, story facilitated by the boy. Similarly here, the people that have wreaked this carnage have left the story a long time ago.
According to the article they tried to work with google on this for 2 years, and it’s still not a final decision - google can appeal.
Although, they should have put a fine of $12b (all of googles yearly earnings), effective immediate, and double it every year until non competitive practices ended.
