The European Commission announced Monday it is conducting an investigation into Volkswagen regarding the company’s emissions scandal.
This is the second initiative in a month by the European Union against big business, with the decision to probe Volkswagen coming just two weeks after the commission slammed Apple with a $14.5 billion dollar tax penalty in Dublin. (RELATED: Ireland Doesn’t Want Apple’s Back Taxes, Just It’s Business)
Experts note the commission’s investigation could mean at least $40 billion in fines for the German automaker throughout Europe.
Volkswagen admitted to installing software to artificially reduce the reported amount of nitrogen oxide released in 11 million of its diesel engines in December, 2015. The company installed these “defeat devices” after allegedly finding out there was no legal way to make their diesel meet the tight U.S. regulatory standards in “the required time frame and budget.”
There was a month-long probe into the German automaker to secure financial compensation for Europeans affected. The European Commission believes Volkswagen broke some 20 laws in EU countries by cheating emissions tests.
The U.S. received some $14.7 billion dollars from the company for the 475,000 Americans who purchased cars with defeat devices, according to The Wall Street Journal.
Volkswagen CEO Matthias Müller went to Brussels the same day the U.S. reached a settlement with his company to dissuade the EU from taking similar measures.
Müller told the Commission Volkswagen had no intentions of reaching a settlement with European citizens. He explained that the defeat devices were installed because of American regulations, not European ones, the Journal reports.
Müller’s fear is warranted. The company has just around half a million customers in the America, but it has nearly nine million in Europe. If it received a $14.7 billion dollar settlement in the U.S., the EU bill could be astronomical.
The Commission and national officials have no legal redress to impose compensation penalties on the German automaker. If the company were to receive legal action, it would have to come from the European consumers. This is complicated by the fact that each nation in the EU has different laws in pursuing such cases.
The Commission will allegedly meet with consumer representatives Thursday and with consumer-protection agencies Sept. 29, the Journal reports.
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