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Apple Hits Back at EU Law in Court
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It's funny how engaged people can be in a company that sells stuff in this world.
I might cheer on EU in this one 🥊
It's closer to me than this fruit company.
We have a lot of Apple's around here....😉
I might cheer on EU in this one 🥊
It's closer to me than this fruit company.
We have a lot of Apple's around here....😉
A bit more intelligent variation of the pop-stars hysteria 😂
But for sure, who can forget Steve’s presentations when the iPhone was born.
It’s a Phooone....
But today...meeehh just a race of tech.
Apple is fighting this battle on behalf of their customers, since the EU cartel doesn’t really care about them, their security or privacy. All they care about is maximizing the profits of people like Tim Sweeney.
Did you count the graft
Apple isn’t a bargain basement vendor who competes on price. They compete on quality, like many European brands do.
Nothing costs more than healthcare whose availability is constrained - a problem pretty much unique to government healthcare. Whenever governments interfere in commerce, everyone loses.
Your analogy falls flat on its face because competition in the phone hardware and software space is alive and well. *Consumers* aren’t affected by vendors having to agree to Google or Apple’s terms — to the contrary, consumers benefit. Similar to stores in a mall, consumers benefit from getting all their shopping done in one place, and from the quality requirements and reviews that are done.
Let’s not pretend this is about consumers. It’s about greedy software developers like Tim Sweeney and Epic who want to maximize their revenue, and are aggressively pa… lobbying EU governments to increase their profits.
If the EU actually cared about consumers, they’d be legislating protections like Apple’s.
China also seems to have a lot of fruit there. We might just feel sorry that we don't have enough fruit here... take a look.
Do we even have a proper fruit shop here?
I've seen some products here from Huawei at some point, but I didn't get that far to consider check it up more seriously. If I don't recall wrong they have small phones that felt very nice. Who knows?
I haven't seen anything that this girl from South Africa is showing in the video. I've bookmarked her site for future reference. Apple (US) technology has a long way to go to catch up with the Chinese. Sanctions certainly work wonders!
It’s pretty funny the dividing between those that want Apple punished and those that want Apple to win over these inane laws. A such is the internet.
Define "good" profit please. As best as you understand it. And then tell the rest of the world that "good" is good enough.
Why not try and be first?
So why are there no laws to open up ASML to more competition? Same for Germany's Zeiss? Surely they function as gatekeepers that the whole world HAVE to go through.
Most of what comes out of China is a direct rip off of either Apple or Samsung products. Yes, they certainly add more features to the copy. But they also don't have to worry about what would sell in the rest of the world either.
All I can say, poor you!
That's what happens to people living in an isolated country (US), or in a well.
In the meantime, you can have a look at the largest city in the world of that CCP-led country that helped build the Apple "empire"... Perhaps you would notice those poorly paid workers who help make your iPhone?
Interesting, where did they model that city from? Especially that cleanliness!
No.... but it was part of the EU when Apple started using its architecture. But I was actually responding more to the 'American innovation' comment.
Innovation is something that's created in the very country where it is designed. However, when one doesn't possess the toolkit to create that "innovation," one needs the country that has that toolkit (Tim Cook). The toolkit itself is also an innovation and cannot be produced by low-paid workers; it requires highly qualified, innovative individuals. Those two videos above highlight who the truly innovative people are.
Imagine it more like this.
If Apple never enter the double Irish arrangement and paid the taxes as they would have originally done, then the money gettin sent over to the U.S. you would end up exactly where they ended up after the ruling. The EU corporate taxes apply where profits are made, and Apple booked the profits in Ireland.
And Apple sold goods and made a profit in EU. That’s how international tax laws work through the softener permanent business establishments in EU. EU have never recognized the U.S. world wide taxation policy and completely at odds with.
And Ireland simply failed to collect the taxes they were owed and required to do
Incorrect. If Apple had never used the structure, those profits would still have been taxed in the U.S., not Ireland. So no, the end result would not have been the same.
Again, the “Double Irish” was not about avoiding tax on “EU profits” it was about deferring US tax on profits that were legally US sourced. Under US law at the time, Apple could keep foreign earnings untaxed in the U.S. until repatriated. The EU ruling didn’t “fix” that, it retroactively reassigned taxing rights to Ireland, even though those profits weren’t Irish under either Irish or OECD rules.
This is flat out wrong. That’s how sales taxes and customs duties work, not corporate income tax. Selling goods in a region doesn’t mean the profit is earned there. For corporate tax, it matters who owns the IP and controls the risk. Otherwise, every country with an Apple Store would claim a slice of Apple’s global profit base, which is exactly what transfer pricing rules prevent.
The EU doesn’t have to “recognize” it; the US taxes based on citizenship and residence, not EU consent. The problem isn’t conflicting policies, it’s that the EU overrode Ireland’s own laws and OECD norms by using state-aid law to backdoor a tax claim it had no authority to make, and a claim that every court and unbiased expert agreed they had no authority to make until the EUCJ overruled it.
This, again, is flat out wrong. Ireland didn’t “fail to collect”, it concluded that no such taxes were owed under Irish tax law, because they weren’t. (Which is supposed to be Ireland’s business, not the EC’s).
Apple and Ireland followed Ireland’s tax code, which applied equally to all companies. The Commission, after a Vestager witch hunt (where she repeatedly admitted she didn’t understand what was going on but though something must be wrong evause apparently the concept of delayed taxation is too complicated for EU regulators and their defenders), later claimed that code itself amounted to “state aid,” (although they were apparently ok with it from 1997 until 2013) which even many EU legal scholars found an overreach and were shocked when the EUCJ overruled their own precedent and the lower courts to change Irish tax law in a way that completely goes against the founding treaties of the EU.
I don't think anyone's ever really contested that. Apple doesn't even seem to be contesting it here – they appear to be putting questions about whether the DMA is compatible with Europe's own laws.
From the start, it's seemed like what's generally been discussed – by Apple, and by developers and users online – is simply whether the DMA is a good idea.
I think your overall notion is good, and I think it would be interesting and useful to see what happened if Apple suspended business entirely within a region.
But, even with the supposedly-prime "back door" example: isn't this exactly what happened in the UK this year? As with a number of contentious points in the EU (and other points in other countries), Apple's response has been to disable the relevant features in that region and carry on. I'm not aware it's ever turned out their only option has been to halt business entirely.
I’m not conflating revenue with profits. As the profits Apple earned was booked in Ireland. And Ireland had to tax it at 12~% as every other company had, not 0-1%. The tax arrangement was just simply profit shifting and they applied the authorised OECD approach (AOA) and the arm’s length principle.
Ireland broke EU competition law by not applying theirntax code equally.
After a formal investigation, the Commission concluded in August 2016 that the tax rulings constituted State aid on the ground that they led to a reduction in ASI’s and AOE’s tax bases. Because they were granted only to ASI and AOE, they were selective in nature. For the sake of completeness, the Commission also found that those tax rulings constituted a derogation from the reference system which was made up of the ordinary rules of corporation tax in Ireland.
The tax base of companies that transact mostly or wholly with related companies must be determined according to a realistic allocation of assets and costs.
On 10 September 2024, the Court of Justice delivered its much anticipated judgment, in case C-465/20 P, Commission v Ireland & Apple. It ruled that
www.lexxion.eu
Everyone didn’t agree the profits wasn’t earned there. They explicitly said it was earned there. Claiming the distribution, handling and sale of said product makes zero value and that’s said entities that handles them have little to no margin was recognized as ludicrous. And EU isn’t confiscating global profits. OECD have recognized apples arrangement as foul play with stateless tax entities.
First if Apple booked them in Ireland, not the U.S. and the U.S. have done similar things many many times and recognized that value is created not only by IP and RnD
GlaxoSmithKline (UK) 2006
- Issue: U.S. subsidiary sold Glaxo drugs using IP licensed from the UK parent. And argued IP and RnD were created in the UK, not the U.S.
- IRS claim: Royalties paid to the UK were excessive; U.S. arm under-reported income. And GSK shifted billions of dollars in profit to the UK parent. Therefore, the U.S. subsidiary owed around $5.2 billion in back taxes and interest
- Result: Glaxo paid $3.4 billion, then the largest tax settlement in U.S. history.
- Principle: U.S. insisted that significant profit arose from marketing and distribution performed in the U.S.
The IRS would almost certainly say:
“Hold on. You’re selling BMWs in America. The people, logistics, and warehouses are in Texas. You can’t claim that nearly all profit belongs to a ‘head office’ with no staff and no residence.”
It would then apply transfer-pricing rules and the “effectively connected income” principle to:
- Reattribute most of those profits to the U.S. branch,
- Argue the Delaware “head office” is a fictional entity for profit shifting, and Impose federal tax on the full U.S. source profits.
So even if Apple had said:
“We already paid the IRS the full tax on these profits,”
the Commission would still say:
“That doesn’t matter Ireland should have taxed its share under Irish law.”
State aid focuses on Ireland’s conduct, not Apple’s global compliance.
Again that’s us prerogative regarding deferred taxes on profits. They profits the legal entities generated is taxed locally.
The where Irish by international standards, The European Commission, as supported by the ECJ, analyse the question of what profits are attributable to the Irish branches by reference to the landmark OECD guidance on how profits are allocated to PEs, namely the guidance in the OECD’s 2010 Report on the Attribution of Profits to Permanent Establishments.
That’s also incorrect as the AppStore’s in every country in Europe pays taxes on their profits, why on earth would the global profit base ever be of any relevance? Transfer pricing rules are ment to prevent profit shifting. The Irish Revenue issued private rulings to Apple in 1991 and 2007 regarding this hybrid-double Irish structure, which the EU Commission considered as illegal State aid.
The fact the U.S. have a global tax policy doesn’t change the territorial tax rules that everyone else uses in line with OECD rules and treaties.
Where do you get the notion they where ”okey” with it untill 2013? They where unaware of their existence. And. Ow what foundational treaty did they violate?
And Corporate tax follows functions, assets, and risks (OECD TP; for PEs, AOA/DEMPE for intangibles). Market/branch jurisdictions tax the attributable profit from local functions (distribution, logistics, retail), even if residual IP returns sit elsewhere. The U.S. doesn’t get all the profit as that would be completely against OECD standards.
The Commission according to ECJ said apples Irish branch functions warranted far more than a near-zero margin especially since the “head office” had no substance.