The Commission continues its policy of targeting aggressive tax arrangements for multinationals (Apple[1]—Irish tax benefits case; Engie[2] and McDonald’s[3]—Luxembourg tax benefits cases) as can be seen from the opening of a state aid investigation into a tax ruling granted by the Netherlands to Nike.

Nike and Converse obtained licenses to use intellectual property rights relating to  products in the EMEA region. The two companies obtained the licenses in return for a tax- deductible royalty payment, from two Nike group entities, which are currently Dutch entities that are not taxable in the Netherlands.

From 2006 to 2015, the Dutch tax authorities issued five tax rulings endorsing a  method  to calculate the royalty to be paid by Nike. The Commission is concerned that the royalty payments endorsed by the rulings may not reflect the economic reality as they appear to be higher than what independent companies negotiating on market terms would have agreed between themselves.

[1]      Commission Decision C (2017) 5605 of August 30, 2016 (State Aid SA.38373 (2014 / C) (ex 2014 NN) (ex 2014 / CP), OJ 2017 L 187/1.

[2]      Commission Decision C (2018) 3839 of June 20, 2018 (State Aid) SA.44888 (2016 / C) (ex 2016 / NN)), not yet published. Commission Press Release IP/18/4228, “State aid: Commission finds Luxembourg gave illegal tax benefits to Engie; has to recover around €120 million”, June 20, 2018.

[3]      Commission Decision C (2018) 6076 of September 19, 2018 (State Aid SA.38945 (2015 / C) (ex 2015 / NN)), not yet published. Press Release IP/18/5831, “State aid: Commission investigation did not find that Luxembourg gave selective tax treatment to McDonald’s”, September 19, 2018.