LONDON, Sept 10 (Reuters) - Apple ( AAPL ) lost a long-running

court battle with the European Union on Tuesday, resulting in

the company being forced to pay 13 billion euros ($14.4 billion)

in back taxes to Ireland, as part of a wider crackdown on

so-called "sweetheart deals".

WHAT HAPPENED?

In 2016, the European Commission's competition chief

Margrethe Vestager accused Ireland of having granted Apple ( AAPL )

illegal tax benefits, unfairly diverting investment away from

other countries.

Both Apple ( AAPL ) and Ireland, whose low tax rates helped it

attract Big Tech companies to set up their European

headquarters, successfully challenged the EU ruling.

But the European Court of Justice has now sided with

Vestager, agreeing Apple ( AAPL ) had unduly benefited from unfair

loopholes in Ireland's tax regime, and that the company must now

hand Ireland 13 billion euros in back payments.

WHAT WAS THE 'DOUBLE IRISH' SCHEME?

Part of Ireland's success in luring tech giants was a result

of its old tax regime, under which multinational businesses were

able to cut their overseas contributions to single digits.

The arrangement involved a complex corporate structure

whereby a multinational could channel untaxed revenues to an

Irish subsidiary which then pays the money to another company

registered in Ireland but taxed elsewhere, such as tax haven

Bermuda.

Both companies being Irish led to the term "Double Irish".

Apple ( AAPL ) used a version of the Double Irish scheme until around

2014 when, under sustained pressure from the EU and U.S.,

Ireland closed the loophole.

WHAT DID APPLE SAY?

Apple ( AAPL ) expressed disappointment with the ruling, which is

final and cannot be appealed.

"The European Commission is trying to retroactively change

the rules and ignore that, as required by international tax law,

our income was already subject to taxes in the U.S.," the

company said.

HOW IS IRELAND GOING TO SPEND THE CASH?

In its initial statement, the Irish government did not say.

It will likely be placed into a new sovereign wealth fund that

Dublin set up last year to invest surging corporate tax receipts

that have handed it one of the few budget surpluses in Europe.

The government already plans to cut taxes and increase

spending again in a pre-election Oct. 1 budget. Opposition

parties have repeated calls that the Apple ( AAPL ) tax receipts should

be used to further boost spending now on strained services.

WILL OTHER COMPANIES BE FORCED TO PAY BACK TAXES?

The Commission's case against Ireland was helped by its

ability to secure access to documents in which Irish officials

were unusually frank about the agreement they made with Apple ( AAPL ).

Amazon ( AMZN ) has been investigated for its tax

arrangements in Luxembourg, but last year won an ECJ hearing

which ruled the company did not have to pay 250 million euros in

back taxes.

In 2019, Starbucks won its fight against an EU demand to pay

up to 30 million euros in Dutch back taxes, while Fiat Chrysler

Automobiles lost its challenge against an order to stump up a

similar amount to Luxembourg.