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Europe: Online service platforms including Airbnb, Expedia, Google and Amazon have all won a European court battle against an Italian law that would have required them to disclose more information and make financial contributions.
The dispute between the global online platforms, which all have headquarters in Europe, and the Italian authorities goes back to a mandate adopted in 2021 that would have forced the companies to sign up to a register, disclose certain types of information and pay financial contributions from revenue generated in Italy. If they were to refuse, they would have potentially been liable to fines in the country.
The Italian authorities wanted the platforms to make the contributions, even if their company headquarters were based outside of the financial jurisdiction.
Airbnb and Google [whose European headquarters are in Ireland], Vacation Rentals Ireland Ltd, Expedia [European headquarters in Spain] and Amazon [European headquarters in Luxembourg] challenged the law in an Italian court, before the matter was then referred to the European Court of Justice [CJEU] –Â the highest court of the European Union in matters of Union law. The platforms argued that the law was contrary to EU legislation which states that online service providers are only subject to the rules of the country where they are established.
In a ruling in the Luxembourg-based Court on Thursday [30 May], judges ruled in favour of the companies, saying that “a member state may not impose additional obligations on an online service provider established in another member state”. They added that the Italian law contravened EU market rules relating to e-commerce.
The EU court gave an initial opinion in favour of the online service providers in January. Thursday’s ruling is now final and cannot be appealed.
In December, however, Airbnb agreed to pay €576 million [$621 million] to tax authorities in Italy as part of a probe into alleged tax evasion. Italian prosecutors alleged that the home-sharing firm had failed to collect a mandatory 21 per cent of landlords’ rental income [the income is said to have come in at around €3.7 billion] and pay it to the Italian tax authorities, as per a 2017 law in the country.
Three unnamed people who served in managerial roles at Airbnb between 2017 and 2021, the period during which the violation is alleged to have taken place, were placed under investigation.
A judge in Milan initially ordered the seizure of €779.5 million [$831.6 million] from Airbnb’s European headquarters in Ireland but Airbnb settled the dispute with Agenzia delle Entrate [the Italian tax office] a month later for a lower sum than was previously anticipated.
