EU to appeal Apple’s $15 billion tax bill ruling
- sep
- 25
A court in July ruled that Apple did not in fact owe Ireland the money.
What you need to know
- A court ruled in July that Apple did not in fact owe Ireland $15 billion in taxes.
- The EU is now set to appeal this case.
- The Commission will argue that a previous court set the bar "unreasonably high" with regard to state aid cases.
The European Commission is set to lodge an appeal against a court ruling which quashed a demand that Apple pay Ireland nearly $15 billion in taxes, over claims that Apple had an unfair tax arrangement in company tantamount to state aid.
According to the Financial Times:
The European Commission will on Friday appeal against a court decision that quashed an order for Apple to pay back €14.3bn in tax advantages to Ireland in a landmark ruling that dealt a big blow to Margrethe Vestager, the EU's executive vice-president in charge of competition policy.
In July, a court ruled that an EU bill for $14.9 billion was not appropriate, and overturned the decision. The Commission had previously argued that Apple's tax arrangements in Ireland basically amounted to state aid and that Apple in fact owed Ireland a huge sum of money. In its previous ruling the court stated:
The General Court considers that the Commission incorrectly concluded, in its primary line of reasoning, that the Irish tax authorities had granted ASI and AOE an advantage as a result of not having allocated the Apple Group intellectual property licenses held by ASI and AOE and, consequently, all of ASI and AOE's trading income, obtained from the Apple Group's sales outside North and South America to their Irish branches. According to the General Court, the Commission should have shown that that income represented the value of the activities actually carried out by the Irish branches themselves...
Friday was the last day that the European Commission could appeal the ruling. The report notes that EU's competition chief Margrethe Vestager has been ardently pushing for an appeal against the ruling in internal meetings.
It won't be an easy task for the Commission to get a court to overturn the ruling. The appeal will be limited to points of law, rather than any facts that took place in the case. As noted by mobile litigation expert Florian Mueller:
The final decision will be made by the Court of Justice of the EU (CJEU), which is based in Luxembourg like the EU General Court (which was previously called Court of First Instance) and focuses exclusively on questions of law, not fact--which is a huge problem for the Commission given that the factual findings didn't support its decision in the first place.
A ruling in the case is likely years away. The money in question is currently held in an escrow account whilst the case is decided, which means Apple won't have to write a massive check if the ruling was to go against the company.