(Bloomberg) -- Ireland and Apple Inc. will jointly choose investment managers for as much 15 billion euros ($17.9 billion) of the IPhone maker's money during a tax fight with European Union regulators.
In an order that reverberated across the Atlantic, the European Commission last year slapped Apple with a multibillion-euro bill, saying Ireland granted unfair deals that reduced the company's effective corporate tax rate. Irish authorities will place the money in an escrow account pending an appeal.
If the appeal, which could take as long as five years, is successful, the money will be returned to Apple. Ireland had sought an indemnity to make sure it isn't liable for any drop in the value of the fund while the case winds its way through the EU courts. Apple's role in choosing the fund managers could be one compromise to help resolve that issue.
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.
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.
“The precise terms of the escrow fund are still being negotiated and are subject to confidential and commercially sensitive deliberations so we are not in a position to comment any further at this time,” the Irish finance ministry said in response to questions.
--With assistance from Peter Flanagan
To contact the reporter on this story: Dara Doyle in Dublin at ddoyle1@bloomberg.net.
To contact the editor responsible for this story: Vidya Root at vroot@bloomberg.net.
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