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EU court adviser says Austria can’t force liability law on Big Tech

An advocate general sided with tech companies based in Ireland that are challenging an Austrian law forcing them to police allegedly illegal content.

(CN) — Tech giants like Google and Meta that chose Ireland for their European Union headquarters due to its favorable tax and regulatory regimes should be protected from regulators in other countries wishing to impose tougher rules, an adviser to the EU's highest court said Thursday.

Google, Meta and TikTok – three of the world's biggest digital companies and all registered in Ireland – are challenging an attempt by Austrian regulators to subject their digital platforms to tougher liability rules than those imposed by Irish regulators.

Ireland enforces the EU's digital information rules, among the strictest in the world, but many privacy advocates accuse Irish regulators of taking a very soft approach when it comes to the tech firms registered there. Dublin is a favorite location for Big Tech and Ireland has benefited from its tax revenues and jobs.

Thursday's legal opinion was issued by Maciej Szpunar, an advocate general at the European Court of Justice. His opinion is not binding but serves as guidance for the high court, which is set to hear arguments in the case. Often the court follows the advice of its advocates general.

Szpunar argued that the EU's system of open borders and free trade among its 27 member states should protect Big Tech companies from the additional burdens sought by Austrian regulators.

He pointed to EU laws that “sought to eliminate legal obstacles to the proper functioning of the internal market” and that “divergences in legislation” lead to “legal uncertainty as to which national rules apply to such services.”

“Allowing different laws to apply to a provider or to its service would run counter to that objective,” Szpunar wrote in his opinion.

Under a 2020 law, the Austrian Communications Regulatory Authority is subjecting tech firms based in Austria and outside the country to obey tough liability standards.

The Austrian law seeks to make social media companies and information providers put in place a system for notification and verification of allegedly illegal content. The companies also would be required to publish regular reports on how they handle such notifications and face fines for breaking the law.

The tech companies allege the Austrian law would violate the EU's laws regulating electronic commerce and the bloc's “country-of-origin principle,” which states that a company is subjected to the laws of the EU state where it is based.

Szpunar agreed with the tech companies and said EU law prohibits one member state from restricting the freedom to provide information services from another state. There are some exceptions, such as cases where platforms are deemed to incite hatred or endanger children.

The Supreme Administrative Court of Austria referred the case to the EU high court.

Courthouse News reporter Cain Burdeau is based in the European Union.

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