Nike loses fight against probe into Dutch tax deal

Nike is the latest multinational to come under scrutiny by the European Union.

The Sportswear giant lost its fight to stop a probe into its Dutch tax affairs Wednesday (July 14), as Europe's second-highest court backed an EU investigation that was opened two years ago.

The EU case was part of a crackdown on multinationals' sweetheart tax deals with EU countries, which Brussels says gives them an unfair advantage.

Nike had objected to the Commission's 2019 decision to investigate five tax rulings issued by Dutch authorities from 2006 to 2015.

The rulings, two of which are still in force, endorsed a method to calculate royalty payments to Nike's Dutch entities for the use of intellectual property.

The Commission said the royalty payments appeared higher than those that independent companies would have agreed between themselves, giving Nike a selective advantage amounting to illegal state aid.

Nike argued it had provided insufficient reasoning to show the case constituted Dutch state aid.

But judges at the General Court said the EU executive carried out its provisional assessment of the measures in a diligent and impartial manner.

The Commission has a mixed record defending its cases in court, losing ones against Apple and Amazon, but winning against Fiat Chrysler and Engie.

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