Apple: European Commission Made ‘Fundamental Errors’ in Irish Tax Ruling

Apple has claimed that the European Commission made "fundamental errors" when it ruled last year that the company owed Ireland 13 billion euros ($13.7 billion) in unpaid taxes plus interest.

Apple appealed the commission's decision in December, but on Monday the company published a piece in the Official Journal of the European Union detailing 14 pleas in law to support its action, according to The Irish Times.

The European Commission argues that Irish revenue commissioners gave Apple unfair advantage between 1991 and 2007 by allowing the company to move income from the European market through two "non-resident" head office subsidiaries based in Ireland.

Apple and the Irish government, which has also appealed the commission's decision, argue that the bulk of those profits are due in the U.S.
"The Commission made fundamental errors by failing to recognize that the applicants' profit-driving activities, in particular the development and commercialization of the intellectual property (Apple IP), were controlled and managed in the United States," Apple said, according to the Official Journal. "The profits from those activities are attributable to the United States, not Ireland."

Apple maintained that the commission had "failed to recognize that the Irish branches carried out only routine functions and were not involved in the development and commercialization of Apple IP, which drove profits".

Cupertino also said that the commission failed to conduct a diligent and impartial investigation, and "exceeded its competence" as it relates to the Treaty on the Functioning of the European Union, by "attempting to redesign Ireland's corporate tax system".

Apple CEO Tim Cook has called the EC's ruling "total political crap" and described the lower end 0.005% tax rate as a "false number." Ultimately, the Apple CEO believes that the decision will be reversed.

Appeals by Apple and the Irish government have been made to the European Union's General Court, where proceedings may take up to two years to complete, after which the case is likely to go all the way to the European Court of Justice.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.


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AirPods Deliveries Arrive Across Europe as Retail Store Stock Dwindles

Early orders of AirPods arrived across Europe this morning as people were seen waiting outside Apple retail stores eager to get hold of a pair of the new wireless earphones before initial stock ran out.

Queues were reported outside Apple's Regent Street store in London and some other brick-and-mortar stores scattered around the U.K., but stock is reportedly limited and going fast. Regent Street was said to have only 150 units, while the Apple Store in Bath reportedly had only 10 in stock upon opening. Reddit user googang619 said that Newcastle's Eldon Square store initially had 25 pairs in at 9 a.m. but "they had sold twenty of them in the first 10 minutes".

Regent Street Apple queue
People queue for AirPods outside Regent Street Apple Store (Image: Derek Baker)

For those lucky enough to have got in on the first wave of online orders last week and received the earphones on Monday via courier, the first impressions of Apple's audio accessory have so far been overwhelmingly positive, with wearability and ease of pairing coming in for particular praise.

Bringing a new case of AirPods within two inches of an unlocked iPhone, iPod touch or iPad and flipping the lid brings up a dialog on the screen offering to pair the device. Once the option is tapped, the AirPods are identified as the owner's and subsequently pair automatically.

MacRumors reader The Game 161 said of the Bluetooth connection: "Incredible, left phone in house, walked up the drive and it was still there".

airpods
Twitter user Long Zheng called the Bluetooth connection range "spectacular" and said he was able to walk around his whole house listening to podcasts. He also said they were "much more comfortable than traditional EarPods, much lighter on the ear and no pulling from the cord". MacRumors reader Boardiesboi agreed, claiming they "almost feel like they're not there" because they're so light.

As for audio performance, MacRumors reader ssrij called the AirPods "louder than EarPods", with better sound quality and stronger bass than Apple's wired earphones. Bazooka-joe called the audio quality "much better than expected. Lots of bass. Very clear."

Apple has included a Lightning to USB-A charging cable with the AirPods, rather than one with a USB-C connection for connecting to newer MacBook Pros. We'll post a more in depth look at how the AirPods function and perform later in the day.

Tags: Europe, AirPods

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Apple Set to Appeal EU Tax Ruling This Week

EU-apple-taxApple is set to appeal this week against the European Commission's ruling that it must pay up to 13 billion euros ($13.8 billion) to Ireland in back taxes (via Reuters).

EU regulators concluded in August that Apple had received undue tax benefits from Ireland – where the company's European headquarters are located – which allowed it to pay substantially less than other companies.

Apple CEO Tim Cook vowed to appeal the ruling at the time, calling the back tax calculation a "false number" and the EU's judgement "total political crap". The Irish government also rejected the conclusion and said it would fight to reverse it.

On Monday, Apple's General Counsel Bruce Sewell told Reuters that the company's imminent legal challenge will be based on its belief that EU regulators willfully ignored tax experts to come to its conclusions.
"The Irish put in an expert opinion from an incredibly well-respected Irish tax lawyer. The Commission not only didn't attack that - didn't argue with it, as far as we know - they probably didn't even read it. Because there is no reference (in the EU decision) whatsoever."
Sewell also said Apple intends to challenge the EU's basis for its penalty judgement, and will argue that a "crazy notion of non-residency" was chosen on purpose to produce a punitive amount, when other legitimate tax law arguments could have been used that would "produce much lower numbers". As to why the EU had gone down its chosen route, Sewell said he believed regulators had singled out the company because of its success.
"Apple is not an outlier in any sense that matters to the law. Apple is a convenient target because it generates lots of headlines. It allows the commissioner to become Dane of the year for 2016," he said, referring to the title accorded by Danish newspaper Berlingske last month.
Ireland also issued a statement on Monday, saying that the EU commission had "misunderstood the relevant facts and Irish law".
"Ireland did not give favourable tax treatment to Apple - the full amount of tax was paid in this case and no state aid was provided," it said. "Ireland does not do deals with taxpayers."
In addition, Apple says it plans to tell the court that the Commission erred when it ruled that Ireland-based Apple Sales International (ASI) and Apple Operations Europe existed only on paper, with no justification for the billions of euros it posted in untaxed profits. Sewell said that just because a holding company has no employees on its books doesn't mean it is inactive, since it could be actively managed by employees of its parent company:
"When Tim Cook, who is the CEO of our company, makes decisions that impact ASI, the Commission says we don't care because he is not an ASI employee, he is an Apple Inc employee. But to say that somehow Tim Cook can't make decisions for ASI is a complete mis-statement of corporate law, it's a misunderstanding of how corporations operate."
The strongly worded statements from Apple and the Irish government form a two-pronged attack on the European Commission as it readies a more detailed version of its ruling for publication in relation to the coming court case.

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European Union Moves Forward With Plans to Eliminate Roaming Charges Next Year

European Commission members met on Wednesday to discuss draft rules intended to eliminate roaming charges in the European Union as of June 15, 2017.

iphone-roaming
(Image: TapSmart)

The Commission said it is determined to put an end to roaming charges commonly billed by carriers when a customer calls, sends messages, or uses data on their mobile device while abroad in the European Union, outside of their primary country of residence, subject to proportionate checks for abusive usage.

European regulators have proposed a "Roam like at Home" solution that would allow travelers to call, text, and browse the web on their mobile devices when abroad in the European Union for no extra charge than the price they pay at home. It is not intended to be used for permanent roaming.

"Roam like at Home" is aimed at people who travel in the European Union for work or leisure. "They spend more time at home than they do abroad, and they make most of their calls, texts and use data in their home country," the Commission explained.
Example: with his €70 per month contract, Tim living in Netherlands gets unlimited calls, texts and data for his smartphone. When he travels abroad on holidays, he will have unlimited calls and text. For data, he will get twice the equivalent of €70 worth of data at the wholesale roaming data price cap, i.e. 0.85 cent/MB according to the Commission wholesale proposal, meaning more than 16 GB in this case. While roaming, he will get twice the volume he has paid for.
The latest draft further clarifies consumer rights, such as ensuring that customers abusing a carrier's roaming policy are not subject to over-intrusive background checks and establishing a minimum alert period of 14 days before roaming charges can be imposed on customers who exceed fair usage.

The revised rules also introduce safeguards to ensure carriers remain competitive. Customers can be asked to prove they live or have "stable links" to a specific country before "Roam like at Home" is included in their contract, while those roaming excessively can be sent a warning message and/or small roaming charge.
If, over a 4-month period, billing data suggests that a consumer has been more abroad than at home, but also consumed more data while travelling in the European Union, the operator can send a warning message. This message will warn the consumers that they have two weeks to inform their operator about their travel situation, or to change their travel or use patterns. Only a very small roaming charge […] can then be applied.
The proposed surcharges for customers who exceed fair usage are €0.04/minute per call, €0.01 per SMS, and €0.0085 per MB of data usage.

The draft legislation has now been sent to representatives for each European Union member state, who will meet on December 12 to vote on the text. Afterwards, the European Commission will be able to adopt the rules.

EU member states include Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.

In September, the Commission said the European government agreed to its proposal to end roaming charges in Europe. This week, the Commission said it will be steadfast to ensure an agreement is reached as soon as possible.


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Mars is looking good in first photos sent home by new orbiter

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A new satellite orbiting Mars just sent home some amazing new images of the red planet’s crags and cliffs. 

The Trace Gas Orbiter — part of the joint ExoMars mission run by the European Space Agency (ESA) and Russia — beamed back the images gathered on Nov. 22, during the spacecraft’s first close flyby of the world.

Some of the new photos — spliced together in video form — show the details of the Martian surface when the spacecraft was only 235 kilometers (about 146 miles) from the planet’s surface. Others were taken when the spacecraft was flying thousands of kilometers from Mars. Read more…

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