Europe's top court issued bad news to both Apple and Google in a single day on Tuesday. The Silicon Valley tech giants have been appealing fines issued by the EU, and the court ruled against both companies, meaning that they must cough up to the tune of 13 billion euros ($14.4B) for Apple and 2.4 billion euros ($2.7B) for Google.
It's particularly bad news for Apple, which only the day before celebrated the launch of the iPhone 16, as well as updating its Apple Watch and AirPod lineups during its annual September launch event. It marks the end of a 10-year battle, in which the company was found to have gained tax advantages in Ireland, where it has its European headquarters. Apple CEO Tim Cook famously dismissed the case as "political crap," but the Court of Justice of the European Union has now ruled that "Ireland granted Apple unlawful aid, which Ireland is required to recover."
"Today is a huge win for European citizens and tax justice," said Margrethe Vestager, the European Competition Commissioner who has been at the helm of many cases holding Silicon Valley giants accountable. "Ireland now has to release up to 13 billion euros of unpaid taxes," she said on X.
Google's fight has been with Europe's Competition Commission, which ruled back in 2017 that the company had been using its shopping comparison tool to favor its own results in search, making it hard for smaller European rivals to compete. At the time, the fine was the biggest antitrust fine the EU had ever issued to a single company, and twice as big as initially anticipated, showing that the EU was serious about making Big Tech play fair in the region. It has since been superseded by another fine, also issued against Google, over Android dominance.
The relationship between Silicon Valley tech titans and the EU has long been a fractious one. Europe's regulations tend to be stricter than those companies face in the US. But with global operations, they must comply with local laws in countries where they have a base. Increasingly, countries including the US are more closely regulating tech companies. But the different rules in different regions often mean that people in Europe have different experiences, such as enjoying better online privacy protections, than those in most US states. In some cases, tech companies have little choice but to withhold products from Europe, such as Meta and Apple's AI tools, which currently have no European launch date.
In antitrust cases like Google's, the ruling has a direct impact on consumers in Europe. In addition to paying a fine, the company must also change how it operates to give rivals a fair chance and shoppers more choices. The impact of the CJEU's ruling against Apple, meanwhile, will hit the company square in the purse strings. In spite of being a trillion-dollar company, Apple's shareholders won't be happy about a multibillion-dollar fine.
Google said on Tuesday it's "disappointed" with the results, with a spokesperson pointing out it had adjusted its practices back in 2017. "Our approach has worked successfully for more than seven years, generating billions of clicks for more than 800 comparison shopping services," the company said in a statement.
The decision holds up the second biggest fine the EU has ever issued to a tech company, according to analyst Grace Nelson from Assembly Research. "Realistically, though, that fine doesn't mean much in the scope of Google's turnover," she added.
Apple didn't immediately respond to request for comment.
Since the EU first issued these fines in the last decade, it's introduced a new set of rules to regulate the digital economy, including the Digital Markets Act, which is designed specifically to rein in the power of Big Tech. Within months of the DMA coming into effect earlier this year, the EU said in June that Apple was breaking its rules and must make changes to its App Store or face penalties. This is in addition to a ruling issued in March, based on a protracted battle between Apple and Spotify, which the EU decided in Spotify's favor. As ever, the game of regulatory Whack-A-Mole continues.