Last month, Ireland said it would reluctantly collect €13 billion from Apple as part of an EU ruling after a long investigation into Apple’s tax affairs. Now with an appeal filed, the funds may sit for up to five years before a final ruling is determined, and Apple wants to be involved in choosing the investment manager.
A new report from Bloomberg today details the latest in the Apple-Ireland back-tax chronicles. It apparently could take as long as five more years to hear whether or not Apple and Ireland’s appeal to the EU ruling will be successful. If it is, Apple would receive the funds it put into escrow, however Ireland wanted to make sure that it wouldn’t be responsible for any losses that the funds might incur in the meantime.
Bloomberg notes that Apple taking part in picking the investment manager may be due to Ireland’s liability concerns. Instead of pursuing a growth focused approach with the billions, the main goal will be to maintain the capital.
The fund will be “invested in low risk, fixed income securities, with the principal investment objective being to preserve capital to the extent possible in light of prevailing market conditions,” the Irish debt office, which is managing the process, said in Dublin on Wednesday, as it sought expressions of interest to manage the cash.
For those looking to win Apple/Ireland’s business, there are a few requirements:
Investment managers bidding for the contract must have had at least 500 billion euros of assets under management at the end of 2016, the debt office said in a document outlining the criteria for awarding the contract published on the Irish government procurement website. It should have 100 billion euros invested in fixed income securities.
While €13-€15 billion is no doubt worth the expense for Apple to appeal the EU ruling, it also won’t be devastating by any means if Apple ends up having to pay the back-taxes. Most recently Apple’s cash reserves were at $261.5 billion. And just yesterday, Apple announced selling another round of bonds.