What Happened: In response to an appeals case filed by Amazon, the European Union's General Court ruled that the European Commission was incorrect in several respects and failed to substantiate that the company enjoyed an undue tax advantage in Luxembourg.
This would mean Amazon will not be required to pay 250 million euros ($303 million) in taxes to Luxembourg.
The European Commission determined in 2017 that Amazon was paying four times less than other local companies in the same jurisdiction. The commission had contended that this was made possible due to overpricing of royalty payments.
"On those grounds, the General Court concludes that none of the findings set out by the Commission in the contested decision are sufficient to demonstrate the existence of an advantage for the purposes of Article 107(1) TFEU, with the result that the contested decision must be annulled in its entirety," the EU court said in a statement.
Related Link: Why Amazon Stock Has A Lot Of Room To Go Higher
Why It's Important: The EU court ruling should come as a relief for Amazon, removing a legal overhang.
The EU court ruled in favor of Apple, and the European Commission subsequently decided to file an appeal with the European Court of Justice, which is the highest court in Europe.
At last check, Amazon shares were down 2.05% at $3,157.86.
Related Link: Jeff Bezos Sells Another $1.7B Worth Of Amazon Shares
Photo courtesy of Amazon.
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