Apple Will Start Paying Ireland Billions Owed in Back Taxes ‘Early Next Year’

In August 2016 the European Commission ruled that Apple must repay 13 billion euros ($15.46 billion) in back taxes dating between 2003 and 2014. According to the EU, the taxes were avoided with the help of sweetheart tax deals from Ireland, and today The Wall Street Journal reports that Apple will now begin paying these back taxes "as soon as early next year."

Ireland's Finance Minister, Paschal Donohoe, reports that Apple and Ireland have agreed to terms of an escrow fund for the money, setting a pace for Apple to begin repaying the taxes in Q1 2018. Apple's payment will sit in the escrow fund while both sides continue to appeal the EU's decision in court.

In October 2017, the EU announced its intention to take Ireland to court for its failure to recover Apple's back tax sum, with Ireland citing the escrow account as the reason why negotiations and repayment were being held up. Now, Donohoe said the next steps will be to determine who operates the escrow account and who manages the fund once Apple begins the repayment process. The EU said that it will only close court proceedings against Ireland once Apple's back taxes are recovered in full.
Ireland will begin collecting €13 billion ($15.46 billion) in back taxes from Apple Inc. as soon as early next year after both sides agreed to the terms of an escrow fund for the money, Ireland’s finance chief said Monday.

In a statement, Apple said, “We have a dedicated team working diligently and expeditiously with Ireland on the process the European Commission has mandated. We remain confident the General Court of the EU will overturn the Commission’s decision once it has reviewed all the evidence.”
The center of the EU's argument is that Irish revenue commissioners gave Apple unfair advantages 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.

Ireland's government has stated it "fundamentally disagrees" with the EU's analysis of the tax situation, leading to its appeal. For Apple, the company said that the EU made "fundamental errors" in the calculations related to the taxes it owes, arguing that the bulk of the profits during this period are due in the United States. Apple CEO Tim Cook put it more succinctly after the first ruling came out, calling the tax avoidance claims "total political crap."

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WSJ Says iPhone X’s Production Issues Due to Fewer ‘Romeo’ Than ‘Juliet’ Modules

The Wall Street Journal reports that iPhone X production issues were due to a supply imbalance of components dubbed Romeo and Juliet.


The report, citing people familiar with the situation, claims it has taken more time to assemble the Romeo module than the Juliet module, both part of the iPhone X's new TrueDepth facial recognition system for Face ID.

The so-called Romeo module reportedly includes the dot projector that beams more than 30,000 invisible dots to create a precise depth map of your face, while the Juliet module includes the infrared camera that analyzes the pattern.

Earlier this week, both KGI Securities analyst Ming-Chi Kuo and sources speaking with Nikkei Asian Review said the TrueDepth system has indeed been a significant bottleneck for Apple suppliers manufacturing the iPhone X.

One of The Wall Street Journal's sources said the assembly process is now moving smoothly, but the production issues add to concerns about extended shortages when iPhone X sales begin in early November.

iPhone X pre-orders begin October 27, and the device officially launches November 3.

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Apple Has Discussed Investing Up to $1 Billion in SoftBank’s Global Technology Fund

Apple has held talks with SoftBank about investing up to $1 billion in the Japanese telecommunication giant's global technology fund, according to The Wall Street Journal. A deal has not been finalized, while the current status of the talks could not be determined, according to the report.

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President-elect Donald Trump and Softbank CEO Masayoshi Son (Image: LA Times)

The so-called "SoftBank Vision Fund," expected to launch next year, will be valued at up to $100 billion, which will be invested into emerging technologies like artificial intelligence and connected internet devices. SoftBank itself will invest at least $25 billion in the fund, while the Saudi Arabian government will pledge up to $45 billion.

Apple's own investment would allow it to gain insight on emerging technologies, according to the report.
Such a move also would reflect a shift in Apple’s investment strategy, which until recently focused on small stakes in young technology companies. Earlier this year, Apple invested $1 billion in Didi Chuxing Technology Co., China’s homegrown ride-sharing competitor to Uber Technologies Inc. SoftBank is also an investor in Didi.
Last week, SoftBank CEO Masayoshi Son said he would invest $50 billion of the fund in the United States and create 50,000 new jobs in the country following a meeting with President-elect Donald Trump. SoftBank is the parent company of U.S. carrier Sprint, which employs about 30,000 people.

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AirPods Delay Attributed to Apple Ensuring Both Earpieces Receive Audio at Same Time

AirPods were originally slated to launch in October, but the wireless earphones were later delayed. Apple said it needed "a little more time" before they are ready for customers, and it has yet to provide an official update since.

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While the exact reason for the delay remains unclear, a person familiar with the development of AirPods told The Wall Street Journal that Apple's troubles appear to be related to its "efforts to chart a new path for wireless headphones," in addition to resolving what happens when users lose one of the earpieces or the battery dies.
A person familiar with the development of the AirPod said the trouble appears to stem from Apple’s effort to chart a new path for wireless headphones. In most other wireless headphones, only one earpiece receives a signal from the phone via wireless Bluetooth technology; it then transmits the signal to the other earpiece.

Apple has said AirPod earpieces each receive independent signals from an iPhone, Mac or other Apple device. But Apple must ensure that both earpieces receive audio at the same time to avoid distortion, the person familiar with their development said. That person said Apple also must resolve what happens when a user loses one of the earpieces or the battery dies.
Last month, Barclays analysts said AirPods should enter production in December. Their research note said quantities would be limited to between 10 and 15 million AirPods to start. Meanwhile, an alleged email response from Apple CEO Tim Cook said AirPods should begin shipping over the "next few weeks."

With just two weeks remaining in the holiday shopping season, some believe Apple should now wait until the new year to launch AirPods, in line with an early rumor about a January 2017 launch. The wireless earphones remain listed as both "coming soon" and "currently unavailable" on different sections of Apple's website.


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