EU court puts Google’s YouTube defense at risk

A €750,000 fine from Italy has turned into a bigger test of how Europe treats platforms that profit from user content. The Court of Justice of the European Union has ruled on a dispute stemming from 19 July 2022, when Italy’s communications authority AGCOM fined Google Ireland and ordered the removal of YouTube videos promoting online gambling.

Those videos were found to breach Italy’s Dignity Decree, the 2018 law that bans direct and indirect advertising of games with cash prizes across all media. Google challenged the decision before an Italian administrative court, arguing that EU e-commerce law shields hosting providers from liability for material uploaded by third parties.

AGCOM argued that the exemption does not apply to gambling at all because gambling falls outside the scope of the e-commerce rules. Italy’s Council of State then asked the Luxembourg court for a preliminary ruling on two narrow but important questions: whether the Article 14 hosting exemption applies to online ads for betting and cash-prize games, and whether Google can rely on that exemption given its relationship with the creator behind the videos.

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The second point is the more consequential one. According to the case, the uploader was tied to Google through a commercial partnership that shared advertising revenue from ads shown before each video. Before signing that agreement, Google reviewed the creator’s videos, the channel’s theme, its most viewed and most recent uploads, and related metadata.

That matters because EU law has long distinguished between a passive host and an active platform. A company that reviews a channel, chooses to partner with it, and monetizes the output looks less like a neutral host with each step.

The ruling does not decide whether the Italian fine itself stands. The CJEU only answers questions of EU law; the national court applies those answers to the facts. The case now returns to the Council of State, which will decide what the ruling means for Google’s penalty.

The implications reach beyond gambling. If hosting immunity does not hold when a platform has a revenue-sharing relationship with an uploader, the legal shield could weaken across the very content businesses monetize most heavily. That comes as Google is already under pressure in Luxembourg: just two weeks ago, the same court upheld its €4.1bn Android fine after rejecting the company’s final appeal.