Wednesday 18 October 2017

Dublin gets rough justice from impatient EU over clawing back €13bn

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John Downing

John Downing

The word "regrettable" covers a multitude of feelings. Paschal Donohoe has good grounds for thinking this one is rough justice from the EU machine.

It was record stuff whacking Ireland in August 2016 with the task of clawing back some €13bn in back taxes from multinational giant Apple.

But now EU Competition Commissioner Margrethe Vestager has threatened Ireland with a new side-bar European Court action for allegedly foot-dragging in efforts to fall into line.

Ms Vestager, who has wide-ranging direct powers under the EU's fair competition laws, had ordered US tech giant Apple to pay an all-time record in unpaid taxes. The commissioner ruled that the multinational had received illegal state aid - Dublin vehemently disagreed and vowed to take the case to the EU Court of Justice in Luxembourg, a process which could take five years.

This was one of a number of controversial deals the EU had targeted between multinationals and notably the smaller EU states, including Luxembourg, Ireland and Netherlands.

Read More: Who is right - the EU or Ireland?

Ms Vestager's finding meant Ireland had to claw back the money from Apple and put it on ice in an independent account.

But this is not ring-Mick-down-at-the-bank stuff. It takes time - and with a certain irony - there are EU rules on fair tendering that apply.

The Finance Minister insists the Irish Government was on the case - the commissioner disagreed, pointing to a formal deadline of January 3 this year for the country to get all its ducks in a row.

"More than one year after the commission adopted this decision, Ireland has still not recovered the money," Ms Vestager said. She added that Dublin had not even sought a portion of the sum.

Significantly, Ms Vestager's Ireland comments came as she announced a demand for Amazon to pay €250m in taxes to Luxembourg. It opens the potential for non-compliance penalties against Ireland - but that would involve another unlikely EU court case. She is tipped as a future EU commission president - this tough stance would be no load in such a quest.

Mr Donohoe said he had never accepted the commissioner's finding in the Apple case. But he again said Ireland was committed to collecting the money due, pending the appeal case finding. Officials said Ireland had been in constant contact with the commission and Apple for more than a year and was close to setting up the so-called escrow account to put the money on ice.

Irish Independent

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