by Foo Yun Chee and Bart H. Meijer
LUXEMBOURG (Reuters) – The General Court of the European Union (EU) made several legal errors in its judgment in favor of Apple canceling a payment of 13 billion euros imposed on the iPhone maker in compensation for “rulings tax” granted by Ireland and it must re-examine the case, declared Thursday the Advocate General at the Court of Justice of the European Union (CJEU).
The European Commission considered in 2016 that Apple had benefited from two tax agreements with Ireland from 1991 to 2014 which allowed it to artificially reduce its tax rate to a level as low as 0.005% in 2014. Denouncing aid In disguise, the Commission’s competition services, then led by Margrethe Vestager, had forced the Californian group to pay 13 billion euros to Ireland.
The EU General Court, however, favorably welcomed an appeal by Apple against this decision in 2020, considering that the European Commission had not sufficiently proven that the group had benefited from an undue advantage via these “tax rulings”.
The Advocate General at the CJEU, Giovanni Pitruzzella, however contests this judgment of the General Court, to which he criticizes “several errors of law” when he ruled that the Commission had not sufficiently proven that the intellectual property licenses of Apple and the related profits, generated by sales of Apple products outside the United States, were to be attributed to the Irish subsidiaries of the Californian group for tax purposes.
“The Advocate General also considers that the General Court did not correctly assess the existence and consequences of certain methodological errors which, according to the Commission’s decision, tainted the tax rulings,” he said.
Giovanni Pitruzzella therefore proposes that the CJEU annul the judgment of the General Court and that the latter carry out “a new assessment”.
Its conclusions are not binding on the CJEU, which is expected to rule within a few months.
Despite appeals from Apple and Ireland, the iPhone manufacturer still had to pay the full 13 billion euros demanded by the European Commission. The sum was placed in escrow.
“We thank the court for the time spent and the ongoing examination of the case. The Court’s judgment was very clear that Apple did not receive any specific advantage or state aid and we believe that this should be confirmed,” an Apple spokesperson said.
Irish Finance Minister Michael McGrath, for his part, said in a statement that Ireland’s position, according to which the country has not granted any tax benefits or public aid to Apple, had not changed.
(With Padraic Halpin in Dublin, French version Bertrand Boucey, edited by Blandine Hénault)
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