Apple - Ireland -Tax - Malta

Case Summary

Chetcuti Cauchi | Published on 17 Oct 2016

Chetcuti Cauchi

The European Commission declared that the Irish tax authorities granted illegal State Aid to two companies within the Apple Group which have been seen to provide an unfair advantage enjoyed by Apple. The European Commission's investigations in 2014 establish that the two tax rulings given by Ireland (in 1991 and 2007),  resulted in Apple  paying significantly less tax than it should have. The granting of this State Aid has led the European Commission to order Apple to pay taxes of 13 Billion Euro back to the Irish Government. Whilst both the Irish Government and Apple have appealed the EC ruling, this has created a period of uncertainty. According to EU state aid regulations, what is requested of Apple is for it to pay up the amount of tax that should have been paid, so as to neutralize the distortion of competition which the granting of such state aid had initially created. On the other hand, the action taken by the EC against Apple has been heavily criticised as undermining the sovereignty of EU member states, such as Ireland, and non-EU countries like the USA. The EC ruling has also steered up debate in Malta. The Prime Minister of Malta, Joseph Muscat, speaking in relation to the State Aid granted to Apple by Ireland, stated that issues of taxation should be dealt with by national governments. In the same interview, the Prime Minister further mentioned that such a ruling by the EU would not affect business activity in Malta due to the fact that  having a different system to Ireland. On the other hand, the prospects for business activity in Ireland are nowhere as clear and certain, as perhaps other countries affected by the case. 

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Key Contacts

Dr Priscilla Mifsud Parker

Senior Partner - Corporate, Tax & Immigration

+356 22056122

Dr Jean-Philippe Chetcuti

Senior Partner, Tax & Immigration

+356 22056111

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