Apple will not have to pay $15 billion dollars in back taxes in Ireland after the EU’s second highest court rejected an EU commission order aimed at cracking down on alleged sweetheart tax deals.

The ruling by the EU general court annuls an order made four years ago by the EU commission which said Apple had benefited from illegal state aid following two tax rulings in the Irish courts which, the Commission claimed, had artificially reduced its tax bill.

Apple, a US company, contested the Commission’s order for it to pay $15 billion dollars in back taxes and denied the arrangement with Ireland broke EU competition rules.

In a ruling handed down today, judges at the General Court said “The General Court annuls the contested decision because the Commission did not succeed in showing to the requisite legal standard that there was an advantage for the purposes of Article 107(1) TFEU1,” in reference to the EU’s competition rules.

Ireland, which had also appealed against the commission ruling has always insisted it did not grant a preferential tax treatment to Apple’s Irish subsidiaries Apple Sales International and Apple Operations Europe.

The ruling deals a major blow to EU efforts, led by competition commissioner Maragethe Vestager, to tackle multinational companies’ arrangements with tax efficient jurisdictions for their sales activities.

Attempts by the Organisation for economic co-operation and development to reach agreement on an international tax regime focussed on the revenues of multinational tech giants and social media platforms such as Facebook and Google have stalled recently, with countries including the UK and France introducing their own domestic levies until an international solution is found.

After the US pulled out of talks last month, the EU again raised the prospect of imposing its own global online services tax.

Reuters news reported that Apple’s victory casts doubt on the Commission’s current investigations into deals struck between Ikea and Nike and the government of the Netherlands and an arrangement between the Finnish food packaging firm Huhtamaki and the government of Luxembourg.

The commission is able to appeal the Apple decision on points of EU law to the EU court of Justice. Vestager has said she will consider the General Court’s judgement and possible next steps.

Vestager said she would study the court’s judgment and reflect on possible next steps, Reuters reported. The Commission can appeal on points of law to the EU Court of Justice, Europe’s top court.

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