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Grounds For Irish Tax Ruling Probe, Says Vestager

by Ulrika Lomas,, Brussels

17 December 2014

Margrethe Vestager, the European Commissioner for Competition, has said that there are "reasonable doubts" as to the legitimacy of the rulings provided by Irish authorities to technology giant Apple.

She told Irish state broadcaster RTÉ that an investigation into the rulings is open and that the outcome is still unknown. "What we're doing in the procedural steps is to figure out is there any discrepancy between market reality and the way that a company is treated," Vestager said.

Vestager said that the Commission isn't taking issue with the tax system of any European Union member state in particular. However, she explained that, "where we have an issue is when we find suspicion of state aid, of fiscal aid, of tax rulings not being a tool of legal certainty, but being a tool of fiscal aid."

Last month, Irish Finance Minister Michael Noonan claimed that the European Commission does not have "a very strong case." He told reporters that, based on the legal advice he has received, "it's more than likely that the investigation will be dropped than there will be further investigations." He said the Irish authorities will "win the case quite easily."

The Commission published an Opening Decision in September, in which it stated that the rulings in question may have conferred a selective advantage on Apple, in breach of EU state aid rules. Article 107(1) of the Treaty on the Functioning of the European Union (TFEU) stipulates that any aid granted by an EU member state or through state resources that distorts or threatens to distort competition by favoring certain undertakings or the provision of certain goods shall be deemed incompatible with the common market.

TAGS: compliance | Finance | tax | European Commission | tax compliance | Ireland | revenue guidance | corporation tax | tax planning | transfer pricing | tax rates | telecoms | European Union (EU) | Europe

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