New EU Competition Commissioner must take on US tech giants, says ISME

Current Commissioner Margrethe Vestager

The Irish SME Association (ISME) is calling on the next EU Competition Commissioner to take on powerful vested interests among the big US tech companies.

ISME believes that the incoming EU Commission will need a political heavyweight to take over the Competition portfolio.

ISME CEO Neil McDonnell

ISME CEO Neil McDonnell believes that the issue is not merely their commercial and market dominance but the fact that "the dominance of these transnational corporations is now producing significant and negative political, commercial, and social effects in Western democracies, which allow them free rein; unlike the authoritarian countries which know how to control and exploit them."

Commissioner Margrethe Vestager has had some success with the Google Shopping Case.

However according to Mr McDonnell, "the real problem with Google/Alphabet is that this conglomerate is now so great, and its dominance in so many background fields of the web is so unchallenged, that even billion-euro fines from the EU will not significantly impact it.

"Its many acquisitions such as Android, YouTube, Doubleclick, Postini, Admob, Slide, Admelt, Motorola Mobility, Waze, Nest Labs and many more, show that Google long ago ceased to be a search engine.

"Its commercial dominance is arguably much greater than that of Standard Oil when the US Supreme Court ordered its dissolution in 1911."

Mr McDonnell said that the current Commissioner demonstrated a fixation on taxation, pointing to the 'Apple Tax' case as one example.

"Whatever the failings, if they be so, of the Irish Government in relation to Apple, they are immaterial in the great game of tax avoidance by US multinationals," said Mr McDonnell.

"The Institute on Taxation and Economic Policy report in Washington DC has noted that Amazon enjoyed a negative tax rate in the US in 2018. That is not a misprint.

"On $10.8bn of US profits in 2018, Amazon got a tax rebate of $130m, equivalent to an effective tax rate of -1.2%.”

Mr McDonnell concluded: "If small businesses and ‘normal’ politics are to survive, the next Competition Commissioner will have to not merely control, but break up the US tech giants.

"The CCCTB and Ireland’s Apple Tax case are mere sideshows to that greater issue.”

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