{"type":"rich","version":"1.0","provider_name":"Transistor","provider_url":"https://transistor.fm","author_name":"Uncontrolled Opinions","title":"Apple ECJ State Aid Case TP implications","html":"","width":"100%","height":180,"duration":2100,"description":"In this episode, Mikhail and Silvana dive into the 2024 European Court of Justice (ECJ) decision on Apple’s contested tax arrangements in Ireland. While the heart of the matter centers on “illegal state aid,” the conversation highlights key transfer pricing concepts such as the arm’s length principle, the role of cost sharing agreements, and the interplay between EU competition law, MNE corporate tax/TP structures and national tax policies. Mikhail and Silvana also reflect on how this case underscores crucial points for transfer pricing practitioners, from applying the separate entity approach to analyzing IP ownership and economic substance.Key Discussion Points1. Background and Timeline 1980s: Apple Inc. goes public (IPO) and sets up cost-sharing agreements with the Irish subsidiaries Apple Sales International (ASI), and Apple Operations Europe (AOE). The CSA between US and the Irish subsidiaries, allowed these entities to own rights on Apple’s IP outside the Americas.1991 & 2007: Irish tax rulings granted to ASI and AOE. The main provisions of the tax rulings were: (i) operations through a branch structure: ASI, and AOE operated through Irish tax-resident branches; (ii) AOE and ASI had legal rights on the IP profit of all operations outside the Americas under a royalty free agreement; and (iii) the taxable profits of the Irish operating branches was computed based on a cost-plus markup remuneration.2016: European Commission (EC) rules these tax rulings constitute illegal state aid, ordering recovery of €13 billion in back taxes from Apple, plus interest. EC argued that the tax rulings did not reflect the actual value generated by the Irish branches, in particular on the IP held by ASI and AOE.2020: General Court of the EU sides with Apple and Ireland, nullifying the Commission’s decision.2024: European Court of Justice (the “Supreme Court” of the EU) issues its judgment on the Commission’s appeal. The ECJ's decision reinstated EC's original finding, confirming...","thumbnail_url":"https://img.transistorcdn.com/oogPJOJuFoxQZgS7xqTI1nZs4-cuTTCfj9Qu1yLfPHY/rs:fill:0:0:1/w:400/h:400/q:60/mb:500000/aHR0cHM6Ly9pbWct/dXBsb2FkLXByb2R1/Y3Rpb24udHJhbnNp/c3Rvci5mbS85Mzg5/YzY4YmI5ZjBiOGVl/YmNmZGUxMjAzMTk1/ZjM4Yi5wbmc.webp","thumbnail_width":300,"thumbnail_height":300}