Apple Turns Down Invitation to EU Tax Panel Hearing (Corrected)

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By Joe Kirwin

Apple Inc. has declined an invitation to appear before a European Parliament tax investigative committee, which requested its presence along with McDonald’s Corp. and Nike Inc. to answer questions about aggressive tax planning.

In a May 31 letter Apple told Petr Jezek, chairman of the European Parliament Tax 3 Committee, that it declined the invitation because of its pending appeal before the European Court of Justice challenging a European Commission illegal state aid decision. The EU competition authority in 2016 ordered the technology giant to repay 13 billion euros ($15 billion) because it said the company received unfair tax breaks from the Irish government.

“Apple is currently appealing the European Commission decision alleging state aid from Ireland and it’s important to ensure public commentary does not prejudice those proceedings,” Apple said in its letter, a copy of which was obtained by Bloomberg Tax.

Apple has previously given evidence to the Special Committee on Tax Rulings on March 15, 2016.

Private Meeting?

Apple said that it would be willing to meet privately with the European Parliament committee members. The offer didn’t appease Jezek.

“We have been through this game many times before,” he said in a June 1 email. “Apple was clearly invited for a hearing on lessons learned from Paradise Papers which does not deal with its appeal to the European Commission decision on state from Ireland.”

Howard Liebman, a Brussels-based tax attorney with Jones Day and the president of the American Chamber of Commerce in Belgium, told Bloomberg Tax it wasn’t a surprise that Apple declined to appear.

“Most lawyers would advise their clients to not say anything that could jeopardize litigation or prejudice the judges one way or another,” Liebman said in a June 1 email.

The European Parliament tax investigative committee was formed in the wake of the Paradise Papers revelations. It will hold a June 21 hearing titled “Lessons learned from the Paradise Papers” and asked Apple, Nike, and McDonald’s to appear before a panel on aggressive tax planning.

Social Media Success

In 2015, a previous European Parliament tax investigative probing the Luxleaks sweetheart tax rulings asked Alphabet Inc.'s Google, Amazon.Com Inc., and Facebook Inc. to appear. All initially declined, according to a European Parliament official, who spoke June 1 to Bloomberg Tax on the condition of anonymity.

“After they all declined we launched a social media campaign publicizing their decision not to come,” the official said. “It worked. In the end they all came.”

In 2017, two leading Swiss banks—UBS Group AG and Credit Suisse Group AG—also declined to appear before a European Parliament probe of the Panama Papers. After they were threatened with the loss of European Parliament lobby access, representatives of the two financial institutions agreed to meet a European Parliament committee delegation when they visited Switzerland. As a result the move to revoke the lobby rights was dropped, according to the official.

(This story has been corrected to reflect that Apple Inc. wasn’t asked to give evidence in 2015. It has also been updated to note the company did give evidence the following year.)

To contact the reporter on this story: Joe Kirwin in Brussels at correspondents@bloomberglaw.com

To contact the editor on this story: Penny Sukhraj at psukhraj@bloombergtax.com

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