European Tribunal Adviser Calls for Review of Apple's Favorable $14 Billion Tax Case

An adviser to Europe's top court suggested on Thursday that a European tribunal had made legal errors in favoring Apple over a €13 billion ($14 billion) tax order. The adviser recommended that the case be reviewed, potentially posing a setback for the iPhone maker.

Apple's Tax Case and the European Union's Crackdown on Unfair State Aid

The tax case against Apple dates back several years and formed part of a broader crackdown by the European Union's antitrust chief, Margrethe Vestager, on deals between multinationals and EU countries perceived as unfair state aid.

In a 2016 decision, the European Commission concluded that Apple had benefited from two Irish tax rulings for over two decades, artificially reducing its tax burden to as low as 0.005% in 2014. Apple contested the ruling, leading to the EU's General Court upholding the challenge in 2020, stating that regulators failed to demonstrate an unfair advantage for Apple.

Reuters reported that Advocate General Giovanni Pitruzzella at the European Court of Justice (ECJ), the highest court in the EU, disagreed with the General Court's decision. In a non-binding opinion, Pitruzzella argued that the General Court had committed a series of errors in law and recommended setting aside their ruling, referring the case back to the lower tribunal, according to CNN.

"It is therefore necessary for the General Court to carry out a new assessment,” Pitruzzella said.

The ECJ is expected to issue a ruling on this case in the coming months and typically follows around four out of five recommendations from the Advocate General. The final decision will have significant implications for Apple's tax responsibilities in the European Union.

Ireland's Stance and Finance Minister's Response

Ireland reiterated its position, stating that no state aid was provided to Apple. Finance Minister Michael McGrath emphasized that the adviser's opinion does not form part of the final judgment by the Court of Justice of the European Union.

Despite Apple and Dublin appealing against the tax order, Apple had already transferred the full amount to an escrow account held by Ireland, pending the resolution of the case.

Apple reiterated that the General Court's ruling highlighted its prominent position of not receiving any selective advantage or state aid, and believed the ruling should be upheld.

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