On September 24, 2019, the General Court ruled on the appeals against two of the Commission’s decisions ordering recovery of illegal state aid in back taxes that the Netherlands and Luxembourg allegedly provided to Starbucks Manufacturing EMEA BV (“Starbucks”) and Fiat Chrysler Finance Europe (“Fiat”) respectively. These judgments follow the General Court’s ruling in February 2019, in which it annulled a similar Commission decision which found that a Belgian tax scheme for multinational companies constituted state aid. The decisions are anticipated to provide an insight into how the General Court is expected to scrutinize other similar cases currently pending before the General Court.
The General Court overturned the Commission’s decision ordering Starbucks to repay up to €30 million in back taxes to the Netherlands. The Commission found that the corporate tax regime to which Starbucks was subject in the Netherlands constituted state aid on the basis that it resulted in Starbucks’ tax liability being lower than that of companies in a similar situation. In particular, the Commission considered that the Dutch authorities’ tax ruling endorsing a methodology of allocation of profits between the companies within the same group which was not in line with the arm’s length principle, reduced Starbucks’ taxable profit under the Dutch corporate income tax system and conferred an advantage to it compared to domestic stand-alone companies.
Consequently, the Commission ordered Starbucks to repay the amount of the reduced tax burden, namely €30 million, to the Dutch State. Starbucks and the Dutch government appealed to the General Court, which annulled the Commission’s decision on the basis that the Commission failed to adequately state its reasons for finding that the Dutch tax measure provided a selective economic advantage to Starbucks. The General Court endorsed the Commission’s use of the arm’s length principle however, ruling that “Article 107(1) TFEU allows the Commission to check whether that pricing [internally within a corporate group] corresponds to pricing under market conditions [i.e., arm’s length pricing]… thus conferring on that undertaking an advantage within the meaning of [Article 107(1)].”
On the same day, the General Court issued another ruling in a similar case upholding the Commission’s decision and thus ordering Fiat to repay illegal state aid of up to €30 million in back taxes to Luxembourg. Contrary to the Starbucks case, the General Court found that the Commission appropriately used the arm’s length principle, in determining that as a result of a tax measure adopted by Luxembourg, Fiat was given a selective economic advantage compared to similarly situated companies.
It remains to be seen if either judgment will be appealed to the Court of Justice of the European Union (“Court of Justice”). These judgments also come in the wake of hearings in the Apple case, in which Apple and Ireland appealed the Commission’s decision ordering Apple to repay €13 billion (plus interest) in back taxes to Ireland deemed to be illegal state aid. These judgments, in which Ireland intervened alongside the Netherlands and Luxembourg, may shed light on the General Court’s much-anticipated ruling in the Apple case, which is expected in the course of 2020.
 Aid to Amazon – Luxembourg (Case COMP/SA. 38944), Commission decision of October 4, 2017; Aid to Apple (Case COMP/SA.38373), Commission decision of August 30, 2016. The Commission also previously conducted an investigation against Luxemburg for allegedly providing state aid to McDonald’s, but concluded that the reduced tax base did not constitute state aid. See Alleged aid to Mc Donald’s – Luxembourg (Case COMP/SA.38945), Commission decision of September 19, 2018.
 Belgium v. Commission (Cases T-131/16 and T-263/16) EU:T:2019:91, appeal pending.
 See, e.g., Apple Sales International and Apple Operations Europe v. Commission (Case T-892/16) EU:T:2017:925, case pending; Ireland v. Commission (Case T-778/16) EU:T:2018:1019, case pending; Luxembourg v. Commission (Case T-816/17), case pending; Amazon EU and Amazon.com v. Commission (Case T-318/18), case pending.
 Starbucks and Starbucks Manufacturing Emea v. Commission (Joined Cases T-760/15 and T-636/16) EU:T:2019:669, paras. 559– 561.
 This “arm’s length principle” aims to ensure that all economic operators are treated in the same manner when determining their taxable base for corporate income tax purposes, regardless of whether they form part of an integrated corporate group or operate as standalone companies on the market. See DG Competition Working Paper on State Aid and Tax Rulings of June 3, 2016, para. 3
 State aid implemented by the Netherlands to Starbucks (Case COMP/SA.38374), Commission decision of October 21, 2015, para. 377.
 State aid implemented by the Netherlands to Starbucks (Case COMP/SA.38374), Commission decision of October 21, 2015, para. 449.
 Starbucks and Starbucks Manufacturing Emea v. Commission (Joined Cases T-760/15 and T-636/16) EU:T:2019:669, para. 151.
 State aid which Luxembourg granted to Fiat (Case COMP/SA.38375), Commission decision of October 21, 2015.
 Luxembourg v. Commission (Case T-755/15) EU:T:2019:670, paras. 359–367.
 Aid to Apple (Case COMP/SA.38373), Commission decision of August 30, 2016.
 Apple Sales International and Apple Operations Europe v. Commission (Case T-892/16) EU:T:2017:925, case pending; Ireland v. Commission (Case T-778/16) EU:T:2018:1019, case pending.