There were no signs yesterday from EU competition commissioner Margrethe Vestager that the probe was winding up anytime soon. Seamus Coffey an economist at UCC, who has followed the case closely, said that the case could now take to the end of a year to complete. More information has been sent to Brussels by Irish officials.
Commission sources yesterday also played down the delay among political parties here to strike an agreement over a new government as the reason for the long delay in the ruling.
Ms Vestager’s competition directorate formally opened the investigation in June 2014 into whether the Irish authorities effectively struck a sweetheart tax deal involving so-called transfer pricing arrangements with Apple, involving two Apple companies incorporated in Ireland.
Ms Vestager has in the past said that it would be better for the Commission to do a thorough job rather than rush to complete the probe under an artificial deadline.
The Commission has since given its ruling on two other tax rulings involving large multinationals which it had opened at the same time as its probe into Ireland’s dealings with Apple.
It ruled late last year that Luxembourg had provided “selective tax advantages” to the finance arm of Fiat, and that the Netherlands had given advantages to Starbucks that had “artificially lowered” the companies’ tax bills.
That left the Commission’s investigations into Ireland, as well as another case involving Luxembourg and its dealings with Amazon, which also begun in June 2014, still to be concluded.
Last December, the Commission opened yet another probe into Luxembourg and a tax deal with fast-food outlet McDonald’s.
Meanwhile, Apple results published later today will show far iPhone sales have fallen. Apple has warned investors that its quarterly earnings report will bear bad news about iPhone sales.
The world’s most valuable company forecast in January that revenue would drop for the first time in more than a decade as iPhone sales slow. Apple shares have fallen 18% in the past 12 months amid mounting investor concern that customers are upgrading their phones less regularly.
Analysts will probably be reassured by a sales decline that doesn’t outstrip Apple’s projections for the quarter that ended in March.
“From the stock point of view, it is already built into people’s expectations,” said Abhey Lamba, a San Francisco-based analyst at Mizuho Securities, who recommends buying Apple shares.
“If iPhone sales end up in line to slightly better than expectations then it’ll be taken positively.”
That could mean that demand for iPhones, which accounted last quarter for two-thirds of Apple’s revenue, has peaked. Its introduction last month of the lower cost iPhone SE was partly seen as an effort to secure new customers in countries such as China or India. Additional reporting: Bloomberg