European Union versus Google and GAFAM in a series of litigation

The European Union (EU) has stepped up its attacks on US digital giants in recent years, as evidenced by the heavy fine imposed on Google in 2017 and that was confirmed this Wednesday by the European justice.

In addition to certain GAFAM practices (Google, Apple, Facebook, Amazon, Microsoft) considered anticompetitive, Brussels also points to its questionable tax strategies, the low remuneration of traditional media -whose content they use- and the failures in the protection of the data of its users.

Anti-competitive practices

The digital giants were denounced on several occasions by the European Commission for practices considered anti-competitive.

Google, for example, received heavy fines from the European Union (EU), totaling $ 9.561 million.

Wednesday’s ruling by the EU Court refers to the appeal filed by the internet giant against a fine of US $ 2.804 million, imposed in 2017, due to its price comparison service Google Shopping.

Microsoft also received several EU sanctions, including a $ 650 million fine in 2013 for forcing Windows 7 users to use their Internet Explorer browser.

Amazon, Apple and Facebook were also investigated in Europe for alleged violations of competition.

Tax disputes

Germany, Italy, France and Spain are pressing for the establishment of a fiscal floor for the digital giants accused of practicing + tax dumping + (unfair competition) in Europe.

The historic G7 agreement reached in June calls for a global tax of at least 15% on the profits of multinationals.

The reform, originally aimed at the Gafam, received a green light from the G20 in October. Previously, the EU has legally attacked these companies on numerous occasions due to its tax optimization policies.

A high-profile lawsuit pitted Brussels against Apple in 2016 over “undue tax breaks” granted by Ireland in the amount of US $ 15.066 million. But in July 2020, the European Court of Justice overruled the EU executive, who filed an appeal.

In 2017, the Commission ordered another US giant, Amazon, to return US $ 290 million to Luxembourg for “undue tax breaks.”

Compensation of the media

The traditional media accuse Google, Facebook and other large platforms of profiting from their content without any real remuneration.

The concept of “neighbor’s right”, designed to help newspapers, magazines or news agencies to charge when their content is reused on the web, was introduced by article 15 of the EU Copyright Directive , approved in March 2019 by the European Parliament.

France was the first EU country to implement the reform, with a law passed in July 2019 that came into force three months later.

After some reluctance, Google and Facebook signed agreements with French newspapers to pay for the use of their content. This did not prevent the French Competition Authority from fining Google US $ 580 million for not negotiating “in good faith” with the French press, a decision that Google appealed.

Personal data protection

Another recurring European criticism of GAFAM is the controversial and even uncontrolled use of users’ personal data.

Brussels erected a safeguard in 2018 with the introduction of the General Data Protection Regulation (GDPR), which became a global benchmark in this area.

Companies must request the consent of citizens when they request their personal data, inform them of the use that will be made of them and allow them to erase them. Failure to do so can result in heavy fines.

After fining Twitter US $ 521,000 for failing to adequately protect its users’ personal data, the Irish regulator opened an investigation against Facebook in April, following the revelation that the data of more than 530 million users had been hacked in the 2019.

In July, Luxembourg fined Amazon US $ 865 million for breach of the GDPR, a decision the US company appealed.

In France, Google and Amazon were fined US $ 116 million and US $ 40.5 million for “cookie” advertisements deemed non-compliant.