Apple Must Pay Rs 1.2 Lakh Crore In Back Taxes To Ireland, European Court Of Justice Rules

The case revolves around two tax agreements issued by Irish Revenue authorities in 1991 and 2007 to Apple subsidiaries in Ireland.

The ruling is seen as a pivotal moment in one of the world’s most high-profile antitrust cases.

Source : VASANTH/Unsplash

The European Court of Justice (ECJ) has ruled in favour of the European Commission, ordering Apple to pay billions of euros in back taxes to Ireland. This ruling overturns a previous decision from four years ago, delivering a significant setback to both the Irish government and the US tech giant.

The ruling on Tuesday is seen as a pivotal moment in one of the world’s most high-profile antitrust cases. The ECJ’s decision reverses the 2020 judgment of the EU’s General Court, which had annulled the Commission’s 2016 order for Apple to pay €13 billion (roughly Rs 1.2 lakh crore) in taxes, covering the period from 2004 to 2014. The Commission, led by EU competition commissioner Margrethe Vestager, argued that Ireland had provided Apple with illegal state aid through preferential tax rulings.

What Went Down

The case revolves around two tax agreements issued by Irish Revenue authorities in 1991 and 2007 to Apple subsidiaries in Ireland. The European Commission claimed that these rulings conferred an unfair competitive advantage to Apple, allowing it to pay significantly less tax than other companies. However, in 2020, Ireland and Apple successfully challenged the Commission’s decision, with the General Court finding that the evidence presented was insufficient to prove that Apple had received illegal state aid.

The latest ECJ ruling, however, criticises the lower court’s legal assessment, finding errors that prompted the decision to be set aside, reinforcing the Commission’s position.

EU Court Upholds €2.4 Billion Fine Against Google

In another development, the EU’s top court has also upheld a €2.4 billion fine against Google for abusing its market dominance in online shopping comparisons. The European Commission imposed the penalty in 2017, accusing Google of unfairly promoting its shopping service over those of its competitors.

The case, which has been ongoing since a 2009 complaint by UK-based Foundem, highlighted how Google’s practices effectively sidelined rival price comparison services. Despite Google’s objections, the court’s ruling supports the Commission’s findings that the tech giant’s actions stifled competition in the online marketplace, marking another crucial win for EU regulators in their ongoing battle against major tech firms.