EU appeals bloc court's rejection of Apple tax case

Andrew Cummings
September 27, 2020

The European Commission has chose to appeal a European court ruling which absolved US technology giant Apple from repaying Ireland 13 billion euros (about 15.12 billion USA dollars) in tax arrears, the Commission's Executive Vice-President Margrethe Vestager said on Friday.

The EU Commission "respectfully considers that in its judgment the General Court has made a number of errors of law". The judgement in July 2020 was made by the EU's second-hightest court, and the appeal is expected to be heard in the European Court of Justice. "This case has never been about how much tax we pay, rather where we are required to pay it", Apple said in a statement.

The European Commission claimed Ireland had allowed Apple to attribute almost all its EU earnings to an Irish head office that existed only on paper, thereby avoiding paying tax on EU revenues.

On foot of that investigation, it found that two tax rulings delivered by the Revenue in 1991 and 2007 allowed the company to funnel profits through Irish-anchored structures without paying tax in any jurisdiction.

The European Union is preparing to challenge a court ruling last July regarding taxes paid by Apple in Ireland.

European Commission executive VP Margrethe Vestager announced on Friday that she had chose to appeal the General Court's judgement of July 2020 on the Apple illegal state aid case in Ireland. Giving certain multinational companies tax advantages not available to their rivals harms fair competition in the European Union and is prohibited by the bloc's state aid rules, the Commission said.

The European Commission had in 2014 begun its investigation of Apple's tax arrangements in Ireland, and two years later in 2016 concluded that Apple had been able to avoid taxation on nearly all profits generated in the EU single market.

The Court of Justice of the EU (CJEU), the highest court in Europe, will make the final decision in the case.

That non-binding opinion can be a pointer to the ultimate decision which will be take by the court's judges.

"Ireland has not yet been served with formal notice of the appeal", Donohoe stated. However, Apple appealed the decision and, in a July hearing, had its objections upheld.

In July, the EU General Court annulled the commission's ruling that Ireland must collect €13bn in unpaid taxes from the U.S. tech giant.

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