France Targets Apple, Google for 'Abusive Commercial Practices' -- Update
March 14 2018 - 10:45AM
Dow Jones News
By Sam Schechner
PARIS--France wants to fine Apple Inc. and Google for allegedly
taking advantage of smaller French software developers, targeting
two of the U.S.'s biggest companies, as tensions heat up between
the two continents after President Donald Trump said he would adopt
new tariffs that could hit European firms.
The French Finance Ministry said Wednesday it has filed a
complaint asking a Paris court to order Apple and Google, a unit of
Alphabet Inc., to end "abusive commercial practices" following a
three-year government investigation into how the Silicon Valley
companies treat French start-ups that develop and sell applications
for mobile phones. Some developers and publishers are unhappy that
Apple and Google at times take a cut of in-app purchases and get
access to more data on their users and subscribers than the
developers do.
"No matter how powerful Google and Apple may be, they cannot
treat our start-ups and developers the way they do today," French
Finance Minister Bruno Le Maire said on French radio.
"We believe our terms comply with French laws and are looking
forward to making our case in court," a Google spokeswoman said.
Apple didn't immediately respond to requests for comment.
The French finance ministry says there's no connection between
taking on tech firms and the U.S.'s new tariffs and taxes.
However, France has recently become more vocal about its actions
against U.S. firms. A finance ministry official said Europe "needs
to stand up and defend its own interests."
President Trump has said he would implement new tariffs on steel
and aluminum imports, and the U.S. passed a tax overhaul that could
hit European tech and pharmaceutical firms operating in the U.S.
Each side has accused the other of protectionism, raising the
specter of a trade war.
Mr. Le Maire plans to speak with Commerce Secretary Wilbur Ross
later Wednesday about the U.S. tariff plan and push for an
exemption of the EU, according to the finance ministry
official.
Mr. Le Maire has been a prime agitator in other efforts to rein
in the tech giants. The EU is considering levying a new tax on the
revenue--instead of the profit--of tech giants. Mr. Le Maire and
others argue that tech giants use legal loopholes to shift too much
profit to tax havens, and that until laws can be changed to stamp
out such practices, Europe must tax revenue instead.
Mr. Le Maire said Wednesday he is pushing the EU to adopt the
new tax this year. But it remains unclear whether the proposal can
muster the unanimous support from EU countries that it needs to
become law. Ireland, Luxembourg and other low-tax EU countries
where many tech firms are headquartered have expressed opposition
to the measure.
The case France announced Wednesday seeks to address a
"significant imbalance" in the way Google and Apple treat
developers, the finance ministry said, adding the government is
seeking to fine each company two million euros.
"When our developers want to sell their app on Google or Apple,
the fees are imposed on them," Mr. Le Maire said. "That's
unacceptable. It's not the economy we want."
Write to Sam Schechner at sam.schechner@wsj.com
(END) Dow Jones Newswires
March 14, 2018 10:30 ET (14:30 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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