Apple on the European Union’s Order

The European Union required Apple to pay 13 billion euros or $14 billion for back taxes to Ireland. Then, the iPhone maker stated on Tuesday that the order defies reality and common sense. Also, it launched a legal challenge against the 2016 ruling.

In addition to that, the U.S. firm accused the executive European Commission of taking advantage of its powers to combat state aid to retrofit modifications to national law. And in effect, it attempts to change the international tax system and in the process of building legal uncertainty for businesses.

At the General Court, Europe’s second-highest, the argument of Apple came following the EU executive in 2016. And it states the U.S. company benefited from illegal state ais. Also this was due to two Irish tax rulings artificially diminished its tax burden for more than two decades.

Aside from that, the case is significant to crackdown on sweetheart deals for multinationals of European Competition Commissioner Margrethe Vestager. The campaign also led to action against Starbucks, Fiat, Engie, Amazon, and others.

The Side of Apple

Luca Maestri, Chief Financial Officer of Apple, led a six-strong delegation to the court. And five judges would hear both side’s arguments as well as Ireland, Luxembourg, Poland, and EFTA Surveillance Authority, over two days.

Lawyer of Apple, Daniel Beard, stated, “The Commission contends that essentially all of Apple’s profits from all its sales outside the Americas must be attributed to two branches in Ireland.” Beard also added that the firm developed the iPhone, iPad, App Store, and its other products in the United States, not in Ireland. And this became the flaws of the Commission’s case.

According to Beard, the activities of the branches did not involve creating, developing, or managing those rights. And looking at the given facts in the case, the first line defies reality and common sense.