EU court rules in favour of Google and Airbnb in Italian dispute

Irish-headquartered tech giants Google and Airbnb have won a European court battle with the Italian government over a law that would seek financial contributions from the online platforms.

The Italian law planned to levy online service providers for contributions from revenue generated in Italy, even if the company was based outside of the jurisdiction, and also would require companies to sign up to a register or face fines.

Several online platforms had challenged the law in a regional Italian court, which referred the matter to the European Court of Justice (ECJ). In a ruling on Thursday, the Luxembourg-based court said the Italian law fell foul of EU market rules around ecommerce, and as a result would “preclude” its attempts to seek financial contributions or put reporting obligations on companies.

The Italian law, adopted four years ago, sought to regulate platforms by requiring them to submit information and pay financial contributions from their revenues in Italy to the state. The legislation included powers to hit companies with financial penalties if they failed to comply with the regulations.

The law was challenged by Google, Amazon, short term letting platform Airbnb, US travel site Expedia and Vacation Rentals Ireland Ltd.

The companies had primarily argued against the law on the basis that they should be subject to national regulation in the EU country where their European headquarters were based. Google and Airbnb are headquartered in Ireland, as is Vacation Rentals, while Amazon’s European headquarters are in Luxembourg.

The ruling this week follows an initial opinion from the EU court in January that came down on the side of the online service providers. In a statement, the court said Italy “cannot impose” additional requirements on online platforms based in other EU countries, beyond national regulations that already exist in those countries. “The Court of Justice holds that EU law precludes measures such as those adopted by Italy,” it stated.