The General Court of the EU has ruled in favour of Apple and Ireland in their appeal against a 2016 European Commission decision which ordered the tech giant to pay more than €13 billion in back taxes to Ireland.

The commission had found that two tax rulings issued by Revenue to determine the amount of tax to be paid by two Irish-incorporated Apple subsidiaries amounted to illegal state aid under EU law.

Wrong

The General Court of the EU annulled that decision, saying the commission “did not succeed in showing to the requisite legal standard that there was an advantage” under Article 107(1) TFEU, and was wrong to declare that the tax rulings amounted to illegal state aid.

Although the General Court ruling referred to the “incomplete and occasionally inconsistent nature” of the relevant Revenue tax rulings, it argued that these “defects” in themselves were not enough to enable the commission to conclude that Apple had been granted an unfair advantage under EU law.

Discretion

Nor did the commission prove, according to the court, that the tax rulings were the result of discretion exercised by the Irish tax authorities.

The Department of Finance has welcomed the decision, saying Ireland had always been clear that there was no special treatment provided to the two Apple companies.

Apple chief executive Tim Cook (pictured) had previously accused the commission of launching "an effort to rewrite Apple’s history in Europe". 

'Reflect'

In her response, Commissioner Margrethe Vestager said: “We will carefully study the judgment and reflect on possible next steps.”

She said the commission stood behind the objective that all companies should pay their fair share of tax, adding that the court had endorsed its general approach to assessing whether a tax measure was selective and whether transactions between group companies gave rise to an advantage under EU State aid rules.