The escrow fund containing the massive $16 billion fine Apple was commanded to pay by the EU declined by $18 million last year.
The funds are being held in an escrow account while appeals by Apple and Ireland make their way through the court. In the meantime, the money is invested — but, at least based on last year, not as successfully as hoped.
A document from the EU’s Department of Finance notes that:
“The financial statements set out that the net assets of the Escrow Fund as at 31 December 2018 totaled €14,269 million, representing a decline in value of €16 million.”
The escrow fund is managed by three investment managers. Management and investment oversight is carried out by an Investment Committee for the Fund. This comprises an equal number of members from Ireland’s National Treasury Management Agency and Apple. It is mostly invested in, “short to medium-term sovereign and quasi-sovereign bonds.”
With markets struggling in 2018, the fund took a hit. Unless it rebounds, that will ultimately mean a smaller amount being paid out at the end.
With AAPL being up 30% this year, maybe investing it all in Apple wouldn’t be the worst idea in the world…
Apple vs. EU
The European Union handed Apple its giant tax bill in August 2016. It claimed that the company took advantage of illegal state aid that allowed it to route profits through Ireland. The investigation alleged that Apple paid the equivalent of as little as 0.005 percent on all European profits in 2014.
Apple has paid the money it “owes,” but it continues to argue that it has done nothing wrong. As a result, the cash is being held in the aforementioned investment account until the whole case is settled.