How Will Spain’s New “Google Tax” Affect You?

On July 22, 2014 the Spanish Cabinet approved a tax on news aggregators that must be ratified by the Senate before it can be enforced. The new bill may affect translation buyers who want to localize web pages, blogs, news portals, and web applications for the Spanish-speaking market. What businesses and users should expect from linking to their sites remains a subject of controversy.

Google’s Office in Madrid

Google Tax

The new tax would allow news publishers to charge “electronic news aggregation systems,” when “a link and a meaningful description” of an article are posted. In other words, news publishers will be able to charge sites that link to their content. The law, frequently referred to as “google tax,” is clearly designed to force Google and other large search engines to pay taxes, but the vague wording leaves aggregators guessing. A spokeswoman for the Spanish Ministry of Education, Culture, and Sports said that the bill is targeting “old-fashioned ‘news-clipping’ services that have migrated to the Internet, not only in the shape of Google News, but also popular Spanish-language aggregators.”Although the ministry released an official statement pointing out that social media users will not be forced to pay, other businesses that may be affected have expressed deep concern.

One Size Fits Most

The new levy, officially named Canon AEDE, protects only daily newspaper members of that association. That leaves publishers, magazines, and digital outlets that aren’t members of AEDE unable to claim compensation. Moreover, critics are weary that the law will hamper the drive to innovate, because web businesses depend on linking in one way or another. Many of them, of course, are companies interested in global expansion and potential clients for website localization and internationalization.

Out with the Old, in with the New

As in Spain, editors in France have been arguing that Google takes unfair advantage of their efforts. Google resolved a copyright dispute with a 60-million EUR (81-million USD) “Digital Publishing Innovation Fund” to help French media enter the digital age. But, they made clear that it was a one-time deal. The agreement in France included “a partnership with French publishers to help increase their online revenues using Google’s advertising technology.” The Spanish tax is expected to collect about 80-million EUR (107-million USD) per year. It remains to be seen, however, if the money in the publishers’ pockets will lead to a comprehensive renewal of a business model that is becoming obsolete.

There is still another angle to the story: Spanish publishers will miss out on millions of visits if news aggregators decided to stop linking. The German law granted editors an ancillary right, whereas the Spanish tax gives them an “inalienable right” to charge a fee. As a result of that legal approach, the law turns the right that publishers already had (and could license or waive) into a mandatory levy.

It will likely be necessary to wait until the tax has been put into effect to know how the Spanish “Google Tax” will work, and how it will be enforced.