EU court rejects U.S. intervention in Apple's Irish $15 billion tax case

A man looks at the screen of his mobile phone in front of an Apple logo outside its store in Shanghai, China July 30, 2017. REUTERS/Aly Song

BRUSSELS (Reuters) - Europe’s second-highest court has rejected a request from the U.S. government to intervene in Apple’s challenge against an EU order to pay back taxes of up to 13 billion euros (£11.4 billion) because it failed to prove a direct interest in the outcome of the case.

Apple, maker of the iPhone, appealed to the Luxembourg-based General Court a year ago after the European Commission ruled that its “sweetheart” tax deal with Ireland was an illegal subsidy in breach of EU rules against unfair competition.

The then Obama administration had criticised the EU decision, saying the EU was helping itself to cash that should have ended up in the United States.

The U.S. intervention was filed in April, a move to which the Commission objected.

The court said it was unconvinced by the U.S. arguments regarding the alleged negative effects of the EU decision on its tax revenues, the bilateral tax deals with EU countries and its efforts to develop rules on transfer pricing in line with OECD rules.

“The United States of America has failed to establish the existence of a direct interest in the result of the case,” judges ruled on Friday.

The court also rejected a bid by IBEC Company Limited by Guarantee, a representative body for national and multinational companies operating in Ireland, to intervene in support of Apple and Ireland.

It said IBEC had failed to show that its members’ interests would be affected by the result of the case.

The case is T-892/16 Apple Sales International and Apple Operations Europe v Commission.

Reporting by Foo Yun Chee; Editing by Dale Hudson