Image: © Arcansél/Stock.adobe.com
The outcome of this latest appeal in the long-winding case could have massive implications on future tax breaks for multinationals.
The EU’s Court of Justice (EUCJ) began an appeal hearing today (23 May) in which the European Commission sought to overturn a 2020 ruling in favour of Apple and Ireland in what has become a seven-year long battle.
The appeal relates to a €13bn tax bill, which the European Commission declared as illegal benefits granted by Ireland in 2016.
After a lengthy battle between the Commission and Apple together with Ireland, the General Court of the EU announced in 2020 that it would annul the decision calling for Apple to pay the bill – now with added interest.
At the time, the court said the Commission “did not succeed in showing to the requisite legal standard that there was an advantage” gained by Apple’s operations receiving the equivalent of State aid or better treatment than other companies.
In today’s hearing, the European Commission’s lawyer, Paul-John Loewenthal, said the General Court “confused and conflated” several legal issues, which resulted in a “legally flawed judgement”.
‘Entirely misleading’
However, Apple said EU Commissioner Margrethe Vestager’s team made legal errors when they concluded the tech giant was given unfair tax aid from Ireland and demanded that the company repay the money.
Daniel Beard, a lawyer for Apple, said: “The essence of this case is simple, the Commission just got the facts wrong about what activities went on in Ireland.”
In its fight against the appeal, the iPhone maker claims that the multibillion-euro tax bill was not actually due in Ireland but rather is being paid elsewhere.
According to Beard, Apple is currently paying around €20bn in tax in the US on the same profits.
Ireland was also represented today fighting against the appeal. Ireland’s lawyer, Paul Gallagher, said some of the remarks made by the European Commission were “entirely misleading”.
“There is no basis for the Commission decision and I would ask the court to uphold the very careful and exhaustive judgement of the General Court.”
This latest appeal is expected to last a couple of days and is seen as a last-ditch attempt by the European Commission to make an example out of Apple.
The final ruling, which could take up to a year, could determine the future of substantial tax breaks for multinationals by member states.
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