Justice Apple loses before the ECJ in dispute over back taxes

The EU Commission and Apple have been at loggerheads for years, and now around 13 billion euros are at stake. Now the authority can claim an important victory.

Apple has suffered a final defeat before the European Court of Justice (ECJ) in its dispute with the EU Commission over back tax payments of around 13 billion euros (approx. 12.2 billion Swiss francs). The judges in Luxembourg overturned a previous ruling in Apple's favor and ruled in favour of the Brussels authority.

The background to this is a protracted tug-of-war over tax concessions that Ireland had granted Apple. The EU Commission considers this approach to be distortive of competition. In 2016, the Brussels authority demanded that Apple pay 13 billion euros in taxes plus interest. The money has been held in an escrow account ever since.

The iPhone company has always emphasized that the income of the two Irish subsidiaries in question was primarily taxable in the USA. Apple was therefore asked to pay twice.

In 2020, the company prevailed before the EU court, which declared the additional claim null and void. The judges argued that the Commission had not been able to prove that Apple's tax agreements in Ireland from 1991 and 2007 constituted prohibited state aid.

The Commission appealed to the ECJ and was now successful: Ireland had granted Apple unlawful aid that had to be recovered, the judges ruled.

SDA