“The vote to withdraw from the European Union in the United Kingdom has shocked international markets and caused a sudden devaluation of the British Pound,” Mark Hibben writes for Seeking Alpha. “Despite short term headwinds, this may offer an opportunity for Apple. Apple can move its international headquarters from Ireland to the UK, and be assured of being out from under the thumb of EU regulation.”
“The short term effect of the vote appears to be mainly the sudden drop of the British Pound against the US dollar (and the Euro). This could have the effect of making Apple products more expensive in the UK and depress sales,” Hibben writes. “The longer term effects are open to debate. Reaction to the vote seems to depend on political philosophy. Those in favor of smaller government and less regulation hail the move as Britain freeing itself from the yoke of left-leaning Eureaucrats.”
“Britain could benefit from no longer having to comply with EU regulations on taxation and trade, making it a more desirable destination for multinational corporations such as Apple,” Hibben writes. “Britain’s withdrawal from the EU opens up all sorts of interesting possibilities. Britain has now in effect become a competitor to the EU rather than a member of it, and it can do things that it couldn’t do before to make itself more attractive to multinational corporations such as Apple.”
Read more in the full article here.
MacDailyNews Take: Yes, with Brexit, all manner of interesting possibilities are now on the table and may even change the EU’s calculus in regard to their Apple tax probe verdict.
Once again, Apple followed the law when paying their taxes:
There was no special deal that we cut with Ireland. We simply followed the laws in the country over the 35 years that we have been in Ireland. If the question is, was there ever a ‘quid pro quo’ that we were trying to strike with the Irish government – that was never the case. We’ve always been very transparent with the Irish government that we wanted to be a good corporate citizen… If countries change the tax laws, we will abide by the new laws and we will pay taxes according to those laws. – Apple CFO Luca Maestri
SEE ALSO:
How the UK’s Brexit vote to leave European Union affects Apple – June 25, 2016
Historic Brexit vote roils markets worldwide; Apple shares drop – June 24, 2016
Apple tax probe verdict may come next month Irish Finance Minister Noonan says – June 16, 2016
Irish wonder what to do with Apple tax if EU orders a clawback – June 8, 2016
Apple cash move will not end EU tax probe – April 11, 2016
Analyst: Apple investors unconcerned about potential EU tax bill – April 5, 2016
EU’s Vestager says will not complete tax inquiries of Apple, others in second quarter – May 5, 2015
U.S. demands EU reconsider tax probes of its companies – February 12, 2016
U.S. Treasury official to meet EU antitrust team over Apple tax deals – January 29, 2016
Apple and Google stand by Europe tax deals; Rupert Murdoch weighs in – January 27, 2016
Apple could trigger global tax war, potential breakdown of the international tax system – January 27, 2016
Apple CEO Cook lobbies EU antitrust chief over Irish back taxes – January 21, 2016
Think Ireland’s corporate tax is unfair? Wave goodbye to Apple and thousands of jobs if it’s changed – November 14, 2015
Apple announces 1,000 new jobs in Ireland as EU tax ruling nears – November 11, 2015
Apple tax probe won’t hurt Ireland, Finance Minister Noonan says – October 5, 2015
EU’s Vestager says will not complete tax inquiries of Apple, others in second quarter – May 5, 2015
Apple warns of potential ‘material’ financial damage from European tax probe – April 29, 2015
Apple may have to pay Ireland 10 years of back taxes – April 30, 2015
EU’s plans to tackle corporate tax avoidance hits first roadblocks — February 12, 2015
Ireland’s Prime Minister: Apple has nothing to fear from end of ‘Double Irish’ tax avoidance strategy – November 4, 2014
From my perspective, the Brits seemed to be behind most of the annoying EU regulation and “Hey’s let’s Sue” attitude.
And every other prejudice in Europe…
What perspective is that? Britain has had a clear mandage to reduce regulation within the Uk and the EU since the 80’s If it wasn’t for the special British Veto business would by now be all but impossible. I suggest you actually read some history about what has actually been happening in Europe before casting judgement. It’s become a beauocratic non democratic mess and hence why many Britains wanted out regardless of the the short to medium term financial pain.
Apple could already have done that by switching to other countries that are in continental Europe but not members of the EU.
Much as I would like Apple to have a base in the UK, I can’t see how the advantages might outweigh the disadvantages.
Exactly. Apple is in Europe to do business in all of Europe, not just England. EU regulations will apply within the European single market whether the European HQ is in an EU member country or not. That’s how it works now with Norway and Switzerland. All that moving to England would accomplish is superimposing an extra layer of British regulations on top of the EU regs that would still apply to most of Apple’s European operations.
Given the pro-England anti-foreign sentiments that drove the Leave vote, there is absolutely no reason to suppose that a foreign business like Apple will get better treatment in post-Brexit England than it currently enjoys in Ireland. What it will get is complete uncertainty as to what the business climate might be. Better the devil you know than a complete unknown.
Just wondering where this rumour has come from. It seems so unlikely on so many levels.
Has Apple ever said anything that might suggest they were considering moving from Cork? Everything I have read about Apple’s European arrangements suggests that Apple are entirely happy with their base in Cork and have no intention of moving.
It’s unlikely that Britain will envoke article 50 of the Lisbon treaty until it has secured a free trade agreement with the EU, therefore there is no reason why Apple could not benefit from relocating there. Time will tell.
Nope. There is no way in hell that EU gives Britain a free ride to 500 million people Euro Zone. If Britain wants out they will stay out. Apple has so long relationship with Ireland that they are not going to go anywhere and Ireland stays in the EU.
(Something I posted at Facebook today that shines some interesting light on Brexit):
Brexit is NOT over… yet.
I learned today that the Brexit referendum was only an ‘advisory’ vote by British voters. Brexit is NOT an exit from the EU. Not yet!
Britain is a ‘Representative Democracy’. As such, voters have no direct voting rights in government decisions. Voter’s representatives make the decisions. Brexit is no exception. This means that the British parliaments (plural) have to approve exiting the EU. This has NOT happened yet.
The Scottish Parliament is talking about NOT approving Brexit, as per the ‘advice’ of their citizens during the Brexit vote. Northern Ireland is considering the same. Only the citizens of Wales and England ‘advised’ their parliaments to exit the EU. Therefore, we have a SPLIT in the ‘advice’ of citizens. It’s NOT a done deal. Not yet! Both the Wales and England parliaments have NOT YET approved Brexit, meaning that it has NOT happened yet.
What fun that news around the world ignores this fact. Conclusion: Modern journalism continues to decay into crap.
Former UK minister urges Westminster to block Brexit result
David Lammy says parliament has to “stop this madness”
…And I neglected to add back two end-of-paragraph Returns that WordPress pulled out of my paste from Facebook. Another reason I wish WordPress allowed editing after posting. 🙁
Technicalities my friend. Cameron has already announced that he will resign and is washing his hands of it. You might be right though there will be some bickering with Scotland and Ireland, not to mention Gibraltar so it’s bound to be exciting and full of popcorn but not for long, you see with Cameron gone they will have to have a new leader by October.
Got to hand it to them, getting a new leader elected in just a few months, that’s a feat that should make others wake up, but probably won’t.
Cheers.
Ah, I forgot Gibraltar! They clearly want to stay in the EU.
I’ve been listening to the BBC today and it’s apparent that Labour Party leader Jeremy Corbyn is going to have to resign as well.
But will the Parliament in London finalize Brexit? It hasn’t happened yet!
Derek:
What Road Warrior said.
The party leaders in the UK are selected by a mail ballot of the dues-paying membership of the party, with the leader of the party that can command a majority in Parliament serving as Prime Minister. That is why the popularly-selected Labour leader can now ignore what the members of his party in Parliament want… he is not answerable to them, but to the general party membership.
Candidates for Parliament are selected by a local party committee; those who go against party directives are simply deselected and replaced with someone more compliant. All the major parties in England (though not Scotland or Northern Ireland) have agreed to be bound by the referendum outcome, so any Member of Parliament who voted now to Remain would be replaced before the next General Election. An election is likely before the end of 2016 and could come much sooner.
Even if it were not a matter of party discipline, any MP who voted to ignore the will of his constituency would be defeated in the election. The whole point of the referendum was to replace representative government with direct democracy. Any attempt claim now that the politicians sitting in Parliament are more qualified to make the Brexit decision than the general public would spark mass protests and civil unrest.
The number of constituencies where the local majority favored Leaving is much more lopsided than the overall popular vote margin would indicate. Hardly any English constituencies outside London, Manchester, Liverpool, Cardiff, and Cambridgeshire voted to Remain. None of the MPs from pro-Leave constituencies could afford to vote Stay if they wanted to serve in government ever again.
Even if it were not a matter of party discipline, any MP who voted to ignore the will of his constituency would be defeated in the election.
As is being pointed out this very day in the British press, it may well save a politician’s career if they IGNORE the Brexit vote! I’m frequently hearing remorse from people who voted for Brexit, if only because of the lies told regarding the economic results of Brexit, which are clearly DIRE. The £ dropped to the equivalent of $1.32 today, the lowest comparative value since 1985. Whether this is mere panic behavior or a harbinger of the future, I do not know.
In any case: Brexit is NOT over. There’s no pretending it is.
OK, here is another analogy: It is true that a U.S. Presidential election is not over on the first Tuesday after the first Monday in November of years divisible by four. It is NOT over until the ballots of the Electoral College are counted at a joint session of Congress the following January 6 and the House of Representatives declares the winner. If 271 of the electors decide to vote for somebody at least 35 years old and a natural-born citizen who wasn’t even on the ballot in November, that person gets to be the President of the United States. However, for all practical purposes, the votes in November bind the electors. The same is true of the Brexit election. Having promised that it would be a binding referendum, Parliament cannot back out now.
The Electoral College, that decrepit and antiquated leftover from the horse and buggy days when speed-of-light communication wasn’t even imaged, has NOTHING to do with this. I am so sorry you brought it up, but on the other hand I figured someone would.
A closer analogy would be the Democrat and Republican conventions this summer. Neither convention is actually required to nominate the winner of the nomination process, even if they hit the required minimum number of delegates to win nomination. Each convention system has its own ways of fiddling with what was ‘supposed’ to be one-citizen, one-vote system. If Trump ticks off the RNC enough, they can fiddle the convention to pick someone else if they so choose. There would be consequences, violence, riots, etc. But they could do it if they are motivated. The same goes with the Democrats (but far less likely) where they could decide Hillary really is a big fat liar whom a vast number of Democrats would never vote for. Instead they could make Sanders the nominee instead.
In each case, we wait to see what the convention does.
We wait to see what the Parliament in Westminster does. They have NOT (yet) voted to exit the EU. There could be the violence, riots etc. if they choose to remain. But they CAN choose to remain in the EU.
It’s been one of the best off topic conversations I have had here EVER! Thank you. But I’m tired out and will watch what transpires. We both know what’s likely to happen and get to listen to the press chatter about that subject for the coming months if not years. 😀
One other thing: it is not the case that the British Parliaments (plural) have to approve anything. The central United Kingdom Parliament sitting in Westminster Palace combines the legislative and executive branches of government for the entire country. The Scottish Parliament, Welsh Assembly, and Northern Irish Executive have only subsidiary authority. The relationship is similar to that between the Westminster Parliament and the Colonial Legislatures in British North America before 1776.
Any law of local application passed by a subsidiary body can be reversed by the UK Parliament. They have no power over foreign relations at all. Unless the Scots secede or the Northern Irish join the Republic, they are bound to follow England out of the EU, although they certainly have the power to petition the central government for terms of separation that favor their regional interests. The Scottish National Party might wish it otherwise, but their subservience in law and in fact is pretty clear.
One other thing: it is not the case that the British Parliaments (plural) have to approve anything.
YES it is. What you’re saying is wrong on two levels:
A) The individual country parliaments have to approve Brexit.
B) The London UK Parliament has to approve Brexit.
NONE of the above have yet approved Brexit. Get it yet?
And as I already pointed out, Northern Ireland and Scotland’s parliaments are talking about NOT approving Brexit, which would kill Brexit for their countries. How that would affect the ‘United Kingdom’ is uncertain within my understanding of the system. But I’m hearing ‘withdrawal from the UK’ being spoken in the BBC news interviews. Gibralter is equally disinterested in approving Brexit.
Again: Brexit is NOT over and there’s no pretending it is. Not today anyway.
We watch on…
Yes, I get it, but I’m not sure you do. The UK regional legislatures have only explicitly delegated powers, which specifically exclude any authority over foreign relations. Any domestic laws they pass must be consistent with national legislation.
So the Scottish Parliament has as much power to opt out of Brexit as the Massachusetts General Court (the colonial legislature) had to opt out of the Intolerable Acts. Because the UK has no written constitution, absolute power is exercised by the Parliament in Westminster. It has the same power to abolish the current Scottish Parliament and Northern Ireland Assembly as it did to abolish the General Court in 1774 and the Parliament of Northern Ireland in 1972.
Certainly, the Scots and Irish can make the same argument that the colonists did in the 1770s that their local legislatures should have a veto over national legislation. The SNP is making that argument now. but I don’t think it is going to get much further than the argument of South Carolina that it should not be bound by the 1860 presidential election.
I honor your knowledge as a historian. My father has similar skills and interest. I do not.
But I haven’t stated anything contrary to your points. There is no ‘veto’ power by the UK countries over the Parliament in Westminster, as you call it. But the other parliaments can:
A) Still decide to remain in the EU
B) Which would require them to exit the UK
C) IF the Parliament in Westminster chooses Brexit, which is has NOT YET done.
In the short term, the London Parliament can stop all this, as I pointed out is being advised by at least one former minister.
In the long term, this could break up a significant part of the UK with the countries breaking from the UK remaining with the EU.
It’s amusing that we’re discussing something that is being deliberately ignored by the press. I’ve been further listening to the BBC. No one is saying Brexit is exactly done. But no one is saying why exactly it isn’t done. I am.
Yes Derek Currie you’re correct, British members of parliament have a constitutional obligation to act in the best interest of the electorate and in this case Britain as a whole. If leaving the EU is not deemed in the best interest of the population and Britain as a whole then individual MPs can override the referendum vote and vote to stay in. And besides nothing can happen until article 50 of the Lisbon treaty is invoked (and only the British Government can do this) which won’t happen for at least 4 months and the “divorce process” could take up to 2 years from that point. There will be much behind the scenes negotiations to ensure that Britain still has access to European markets before anything is set in stone. Britain imports more goods and services from the EU than it exports therefore it’s in the interest of Britain and the rest of Europe to continue good trading relationships.
The ideal of course would be for the UK to remain in a revised, democratized EU. Add to the list of desired improvements. This could be positive in the end. But at this point I’m merely musing.
This text is cleary written by someone without the slightest clue about the topic. So much so, that it doesn’t even merit a point by point rebuttal!!!!
Another new day “pseudo journalist” looking to draw in idiot ‘know no history’ google heads.
Why oh why would Apple want to do this is beyond me. Stick with the EU team and negotiate with those who are not part of it. Business as usual, except now you have a new customer bureaucracy to deal with.
I’m sure the Brits will be begging for businesses to come their way.
Apple’s tax deal in Eire will keep them there.
The only difference is that sales in UK will be subject to UK corporation tax and will not be able to book them in low tax Eire.
Not to mention that a slew of EU regulations will need to be retained by the UK in order to enable free trade between UK and EU.
That probably isn’t going to happen. The deals with Norway and Switzerland are essentially that they can participate in the single market on the conditions that they (1) allow free immigration and emigration with the EU members; (2) enforce at least 90% of the EU regulations regarding commerce within Europe; (3) pay fees to the EU that are approximately equal on a per capita basis to what the UK is paying in membership fees now; and (4) accept that as a “third country” outside the EU, they cannot participate in decisions about the course of the Union or the regulations that they will be obliged to follow.
Points 1-3 contradict all of the important reasons that the pro-Leave forces cited as reasons for Brexit. Point 4 means that this is essentially taxation without representation. The Norwegians and Swiss accepted the deal because it lets them participate in the single market while pretending that they are still fully sovereign nations outside the Union.
I can’t see the UK buying in on those terms. Even if Parliament was willing to pay the asking price for staying in the single market, the English public would never let them get away with it.
The EU is in no mood to make more special considerations for Britain. It will not have unfettered access to the common market unless it wants the whole Union to fall apart.
Apple right now is headquartered for retail purposes in Luxembourg, for software purposes in Ireland, for marketing and HR purposes in the UK.
The EU has made it clear: no deal that benefits the UK for leaving the Union. It will not get a Norway/Switzerland/Iceland kind of arrangement.
I think the British will deeply regret what they have done and I don’t think Apple will be moving its headquarters there.
United Sates of Europe under Brussels/Germany? We fought for freedom in WWII. Now we have to do it all over again after Germany takes over Europe? Hitler would be proud.
The Brits gave up their right to bear arms and look where they are today. Australia did the same thing. Wake up, people! Or do you savor being slaves? Freedom is not free.
If I thought anybody was still reading this thread, I would ask whether anybody remembers the quote about those who forget their history being doomed to repeat it.
1910s — The continental system of internationalism and commercial interdependence that had kept Europe remarkably peaceful for almost a century breaks down under pressure from nationalism, which leads to World War I. Millions die. In America, this takes the form of isolationism. We turn our back on the world until we are dragged back in by unrestricted submarine warfare. Wilson is reelected on the slogan “He kept us out of war,” and declares war barely a month after his inauguration.
1930s — The League of Nations and other postwar efforts at building internationalism are swept away by another wave of nationalism, which leads to World War II. Millions die. In America, this takes the form of isolationism. Under the slogan, “America First,” the US turns its back on the world until it is dragged back in by Pearl Harbor.
2010s — The postwar efforts at building a system of internationalism and commercial interdependence are threatened by yet another rising tide of nationalism. In America, this takes the form of an isolationist movement that also adopts the slogan “America First.” Some — like Cognitive Dissonance — argue the existence of a new German threat that is best combatted by exactly the same withdrawal from international commitments that brought about the last two wars with Germany. What will drag us back in this time? In a world with nuclear weapons, will we survive it?
A definition of insanity is “Doing the same thing over and over while expecting a different result.”
The presence of Apple in Ireland? Immune to human squabbling. There are contractual, social, familial, and mystic strands that connect them, and technology analysts and journalists don’t fully understand the tensile strength of such bonds. The Macs that were once built there have passed down through the generations sparkling with the touch of faerie wands, were given fond names, and when the time comes will be buried with a tear rather than callously reclaimed for precious metals. Such devotion is forever underestimated by serious-minded people who somehow don’t quite understand that spirit underlies, and fuels, life and consumption.