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BRUSSELS (Reuters) – The European Court of Justice (ECJ) confirmed on Tuesday that U.S. giant Apple received illegal tax aid from Ireland that the state must recover.
The highest European court, which has been seized of an appeal lodged by the Commission, is thus reviewing the 2020 judgment of the General Court of the European Union which annulled the decision imposed on Apple in 2016 by the European executive to pay 13 billion euros in back taxes to Ireland.
According to Brussels, Apple benefited from tax advantages in Ireland on its activities outside the United States from 1991 to 2014, which artificially reduced its tax burden to 0.005% in 2014.
Apple had argued that the Commission’s decision went against reality and common sense. Ireland, which has attracted big tech companies with its low tax rates, had also challenged the EU’s decision.
The Court found in particular that the General Court of the EU erred when it held that the Commission had not sufficiently proven that the intellectual property licences held by Apple Sales International (ASI) and Apple Operations Europe (AOE) and the related profits should have been attributed, for tax purposes, to the Irish branches.
The Court of Justice thus sides with Margrethe Vestager, European Commissioner for Competition, who is leading a fight against sweetheart agreements between EU member states and multinationals.
“The Court has given a final ruling on the dispute and confirmed the European Commission’s 2016 decision: Ireland granted Apple unlawful aid that the State is required to recover,” said Margrethe Vestager.
The American group said it was disappointed by this decision.
“The European Commission is trying to retroactively change the rules and ignores that, as required by international tax law, our income was already subject to tax in the United States,” the iPhone maker said.
The decision is final and cannot be appealed.
(Report by Marine Strauss and Foo Yun Chee, French version by Diana Mandiá, edited by Kate Entringer)
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