Michael McGrath (Cork South Central, Fianna Fail)
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89. To ask the Minister for Finance the number of payments a company (details supplied) will make into the escrow account; when the entire amount will be paid into the account; and if he will make a statement on the matter. [18754/18]

Michael McGrath (Cork South Central, Fianna Fail)
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91. To ask the Minister for Finance the body that will be responsible for the costs incurred on the management of an escrow account (details supplied); the expected cost of running the escrow account; the body that will have a right to the annual yield of the fund; and if he will make a statement on the matter. [18756/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 89 and 91 together.

The Government does not accept the Commission’s analysis in the Apple State aid Decision and has lodged an appeal in the European Courts. However, we have always been clear that we are fully committed to ensuring that recovery of the alleged Apple State aid takes place and have committed significant resources to ensuring this is achieved. Given the unprecedented scale of the recovery amount, this has been a complex technical and legal process.

As the Deputy may be aware, on 24 April the Escrow Framework Deed which sets out the detailed legal agreement regarding the recovery of the alleged State aid was signed by me on behalf of the Government and also signed by Apple. This is a significant milestone with regard to the commencement of the recovery of the alleged State aid. This followed recent announcements that the Bank of New York Mellon London Branch has been selected as the preferred tenderer for the provision of escrow agency and custodian services to the fund and Amundi, BlackRock Investment Management (UK) Limited and Goldman Sachs Asset Management International have been selected as preferred tenderers for the provision of investment management services.

The signing of the Escrow Framework Deed now allows for the final processes to be completed including the formal appointment of the Escrow Agent/Custodian and the Investment Managers which in turn activates the process for the collection of the alleged State aid.

It is anticipated that the funds will flow into the escrow account in significant tranches and I expect that the full recovery will be effected by the end of Q3 2018.

In general, I should say that the costs associated with the fund are a liability of the fund. The arrangements in the Escrow Framework Deed include the agreement that all claims of ownership and access to these vast sums of money is suspended until the European Courts have concluded proceedings that the Government and Apple have brought.

Michael McGrath (Cork South Central, Fianna Fail)
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90. To ask the Minister for Finance if payments made by a company (details supplied) into the escrow account will be deemed to be Government revenue under European fiscal rules at the time the moneys are paid; if the escrow account will be deemed on or off-balance sheet; and if he will make a statement on the matter. [18755/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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Notwithstanding the appeal in the Apple State Aid case and the difference in view between Ireland and the Commission on the issue, the Government is committed to complying with the binding legal obligations that the Commission’s Final Decision places on Ireland. Apple therefore must be deprived of the benefit of the alleged aid, which the Commission have estimated will amount to approximately €13 billion plus interest, as set out in EU Regulations on the recovery of State Aid. These sums will be placed into an escrow fund with the proceeds being released only when there has been a final determination in the European Courts over the validity of the Commission’s Decision.

Following consultation with the Central Statistics Office and Eurostat, it has been confirmed that there will be no impact on the General Government balance and that there will be no fiscal impact for the period in which the funds are in escrow.

This is because Apple and the Government are challenging the Commission’s Decision of August 2016 before the European Courts, and it could be several years before this is ultimately resolved. The basis for this is set out in the European System of Accounts 2010 (ESA 2010), Paragraph 20.189 which states:

When a court of justice rules that compensation must be paid, or a transaction reversed, resulting from or related to past events, the time of recording of the expenditure or revenue is when the claimants have an automatic and incontrovertible right for a given amount that can be individually determined, and when it is unlikely that claimants will fail requesting their due. When a court of justice merely sets a principle of compensation, or when the claims must be reviewed for eligibility and in relation to determination of the amount by administrative services, expenditure or revenue is recorded as soon as the value of the obligation is reliably determined.

As a result, the amount and timing are not recognised until a final judgement before the European courts.