The European Commission (EC) on March 27, 2018, made publicly available the non-confidential version of its opening decision of December 18, 2017, in the formal investigation into the Netherlands’ tax treatment of Inter IKEA Systems BV (Systems) with regard to State aid. The EC explains the reasons for initiating the investigation and requests additional information from the Netherlands and potentially Systems or any other company of the Inter IKEA Group, in order to reach a conclusion. This decision therefore represents the beginning, not the end, of the EC’s formal investigation into this transfer pricing matter.
The EC’s opening decision focuses on two Advanced Pricing Agreements (APAs) granted by the Netherlands to Systems in 2006 and 2011, respectively. Multinational enterprises (MNEs) should be aware of the possible impact of the EU State Aid developments on their current fact patterns and circumstances and plan accordingly.
This is another EC State aid decision in the area of transfer pricing. If the EC’s approach is confirmed in its final decision, we expect further litigation before the European courts.
Multinational enterprises should be aware of the possible impact of the EU State Aid developments on their current fact patterns and plan accordingly.