Felix Reda

Today the European Parliament passed a resolution introduced by the two large groups, EPP and S&D, on “consumer rights in the digital single market”. This resolution had caused quite a stir in the international press since last weekend – before it was even formally submitted to the Parliament. Multiple news outlets created the impression that the Parliament wanted to break up Google.

Paragraph 15 of the resolution underlines the importance of search engines for functioning competition on the digital single market. The European Comission is urged to apply existing antitrust legislation and to consider if unbundling search engines from other commercial services might in the long run be helpful in achieving this goal. A rather tame “call for a breakup”.

A different danger

It was a subsequent paragraph of the resolution, which also deals with search engines, that caught my attention. Here, it is demanded that search algorithms and results should be impartial to keep internet searches “nondiscrimatory” and to “secure competition and freedom of choice for users and consumers”. Consequently, indexing, weighting, display and ordering of search engines should be impartial and transparent.

This wording is explosive. I am led to suspect that its aim is to prepare a European ancillary copyright for press publishers. The attempt to cross-finance big publishers through Google most recently spectacularly backfired in Germany. Is this resolution an attempt to create the puzzle piece that had been missing in Germany?

In October, Günther Oettinger, the EU Commissioner for the Digital Economy and Society, provoked a debate on an EU-wide ancillary copyright law for press publishers before even taking office. Not a month later, the next move is made in that direction – this time in the parliament.

How the German “Google tax” went up in flames

Let’s look back at what happened in Germany: After a long lobbying campaign, an ancillary copyright for press publishers (“Leistungschutzrecht für Presseverleger”) was introduced in 2013. The goal: Publishers should be able to charge search engines and aggregators a licencing fee for serving up links to their articles if such links were accompanied by short snippets of the publishers’ content. The response of the search engine providers in Germany differed: GMX and Yahoo completely removed the websites of the publishers represented by collecting society VG Media from their results. The market leader Google, which had been the primary target of the law, announced that it would continue to display results from these sites, but without any text and image snippets, so as to not violate the new law.

This step had publishers fuming: How dare Google NOT violate their rights und thus not be subject to licencing? Shortly after, VG Media gave in and granted Google a «revocable licence free of charge» – only Google, mind you. In effect, a law that had been put in place to force Google to pay now instead applies to everyone but Google – and thereby only serves to further secure Google’s dominant market position. I submitted an inquiry to the European Commission on the antitrust implications of what in the end amounts to preferential treatment of Google, but I have yet to receive a response.

The missing puzzle piece for the next push

It is obviously in the interest of publishers to disallow Google and other search engines to “circumvent” the ancillary copyright law by delisting the content of anyone demanding licensing fees. They filed lawsuits and threatened an antitrust complaint, but the German antitrust office was unimpressed, responding that Google couldn’t be forced to pay for content it doesn’t want to use. The publisher’s best chance would be an actual law that forces Google to index their content.

That’s precisely what may be the true intention behind the resolution’s wording on “neutrality” of search results. It is a highly absurd idea that search engines could be legally required to index sites which they are not even allowed to include in their results without having previously successfully negotiated a licence. Failure to accept a publisher’s demands in the negotation would leave just one remaining legal step: Completely suspending the search engine’s service.

Our amendments to the resolution

My colleague Michel Reimon and I tabled amendments on this issue in in the name of our parliamentary group. Through a change of paragraph 11, we intended to rule out an interpretation of the resolution that would imply an obligation by search engines to show press articles that are subject to licencing fees through an ancillary copyright for press publishers. Additionally, we proposed a new paragraph to draw attention to the negative impacts of the existing German and Spanish ancillary copyright laws for press publishers on freedom of expression (Amendments 30 and 32). Unfortunately, both amendments were rejected.

If we want the Commission to take a stand against powerful IT giants, let’s concentrate on measures that work: We need to take action following the LuxLeaks revelations and put an end to tax dumping in Europe. Transnational IT companies need to start paying regular taxes like everybody else. Those who truly care about equal opportunities and an innovation driven market will have to agree that tax evasion is the most urgent problem to address.
What we don’t need are newly made-up taxes for single companies with dangerous side-effects that threaten the free exchange of information on the net.

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