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ECJ in favour of Irish-based service providers in case

The European Court of Justice has delivered an opinion in favour of a number of big Irish-based online service providers in a dispute with the Italian government.

Italy had referred the case involving Airbnb, Google, Amazon and Vacation Rentals to the court for clarification.

Under Italian law, providers of online services and search engines are obliged to be entered in a register and to periodically submit information to the authorities.

They are also obliged to make a financial contribution to the Italian state and penalties can be imposed if the companies do not meet their overall obligations.

Airbnb Ireland, Amazon Services Europe, Expedia, Google Ireland and Vacation Rentals Ireland had all challenged the obligations in the Italian courts, arguing that they were contrary to EU rules on transparency and fairness in the online service provision sphere within the single market.

The companies also argued that under the Electronic Commerce Directive, they should be subject to the law of the member state in which they were established, which in these cases are Ireland and Luxembourg.

Italy had argued that the requirements imposed on these companies were in line with EU law.

However, Rome decided to refer the case to the European Court of Justice.

This morning one of the court’s Advocate Generals, Maciej Szpunar, issued an opinion that a member state cannot impose “general and abstract” obligations on online service providers which operate on its territory, but which are established in another member state.

He held that EU law in general, and the Electronic Commerce Directive in particular, precluded the imposition of such obligations.

Mr Szpunar also argued that the Italian requirements were not in line with an EU regulation. which promotes fairness and transparency for business users of online services.

In a statement, the court said the objective of that regulation was the proper functioning of the single market by putting in place a “fair, predictable, sustainable and trusted environment for online commercial transactions”.

In that context, the Advocate General held that Italy could only collect information that was relevant to its obligations under that regulation and to its objectives.

An Advocate General’s opinion is not final and is not binding on the ECJ.

However, in 80% of cases, the final judgement reflects an Advocate General opinion.

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