Ireland selects BNY Mellon to manage €13bn Apple escrow account

6 Mar 2018399 Views

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Apple store in Manhattan. Image: Hethers/Shutterstock

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Apple is expected to start paying money into escrow account for Ireland shortly.

The Government of Ireland has selected New York-headquartered investment bank BNY Mellon as custodian of the €13bn in back taxes that Apple allegedly owes.

The Government established the escrow account to satisfy EU demands after Ireland missed an original collection deadline of January 2017.

As such, Ireland will collect the €13bn plus interest from Apple and hold it in the escrow account, while at the same time appealing the 2016 decision by the European Commission regarding the iPhone giant allegedly owing back taxes to Ireland.

According to The Irish Times, the Government selected BNY Mellon to be custodian for the funds that will arrive in the escrow account within the next two months, as reported in late February.

It is understood that final contracts have yet to be signed as a standard cooling-off period begins.

Battle over back taxes

In 2016, EU competition commissioner Margrethe Vestager ordered the Irish Government to retrieve €13bn that the EU claims Apple avoided paying, thanks to alleged sweetheart deals.

“This selective treatment allowed Apple to pay an effective corporate tax rate of 1pc on its European profits in 2003, down to 0.005pc in 2014,” she said at the time.

Apple CEO Tim Cook dismissed any wrongdoing, saying: “It’s maddening. It’s disappointing. It’s clear it comes from a political base and has no basis in fact.”

Both Apple and the Irish Government vowed to fight the order in the highest EU courts.

Apple store in Manhattan. Image: Hethers/Shutterstock

Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com