Apple has been told it will not have to pay Ireland €13bn (£11.6bn) in back taxes after winning an appeal at the European Union’s second highest court.
It overturns a 2016 ruling which found the tech giant had been given illegal tax breaks by Dublin.
The EU’s General Court said it had annulled that decision because the Commission had not proved Apple had broken competition rules.
It is a blow to the European Commission which brought the case.
However, it has 14 days to appeal the decision at Europe’s top court, the European court of Justice.
What did Apple say?
“This case was not about how much tax we pay, but where we are required to pay it,” Apple said in a statement. “We’re proud to be the largest taxpayer in the world as we know the important role tax payments play in society.”
The Irish government – which had also appealed against the ruling – said it had “always been clear” Apple received no special treatment.
“The correct amount of Irish tax was charged… in line with normal Irish taxation rules.”
EU Competition Commissioner Margrethe Vestager, who brought the case, said she would “study the judgment and reflect on possible next steps”.
She added that the Commission stands “fully behind the objective that all companies should pay their fair share of tax”.
What was Apple accused of?
The European Commission brought the action after claiming Ireland had allowed Apple to attribute nearly all its EU earnings to an Irish head office that existed only on paper, thereby avoiding paying tax on EU revenues.
The commission said this constituted illegal aid given to Apple by the Irish state.
Irish EU court appeal on Apple tax ruling
But the Irish government argued that Apple should not have to repay the back taxes, deeming that its loss was worth it to make the country an attractive home for large companies.
Ireland – which has one of the lowest corporate tax rates in the EU – is Apple’s base for Europe, the Middle East and Africa.
In Wednesday’s ruling, the Luxembourg-based General Court sided with that position, saying there was not enough evidence to show Apple had received illegal state aid or minimised its tax bill.