Abstract
rulings granted to U.S. multinationals by Ireland, the Netherlands, and Luxembourg were principally designed to achieve U.S. tax deferral and not EU tax avoidance. Adverse BEPS effects within the European Union would be immaterial in comparison to the deferral of U.S. tax on residual IPrelated profits, and would have occurred primarily in countries other than those charged with the granting of unlawful State aid. The Irish, Dutch, and Luxembourgish treasuries have not foregone tax revenues in favor of the U.S. multinationals they allegedly aided, which is a requirement for a finding of prohibited State aid. However, the conduct of these low-tax EU States, which enables the deferral of U.S. tax and facilitates the accumulation of financial capital withinthe European Union may benefit such countries possibly at the expense of other EU Member States, and can therefore be viewed as a form of tax competition that is questionable in light of the EU Code of Conduct. Conversely, if the retroactive State aid charges were to prevail, the U.S. Treasury would forfeit its claim over unrepatriated earnings of U.S. multinationals. The significant tax policy implications for both Europe and the United States resulting from the State aid decisions by the EU Commission are explored here in detail.