Throng of Corporate Criminals Demands “Rule of Law” in Apple EU Tax Case

"In the interest of all countries that respect the rule of law, this decision must not be allowed to stand," says the Business Roundtable.

Photo: Chip Somodevilla/Getty Images

John Engler, the president of the group of corporate overlords who comprise the Business Roundtable, wrote last week to the heads of all 28 European Union countries, declaring that the “rule of law” demands that they overturn the European Commission’s recent decision that Apple owes Ireland $14.5 billion in back taxes.

“In the interest of all countries that respect the rule of law, this decision must not be allowed to stand,” Engler wrote. He also added that “Business Roundtable’s interest in this matter is for respect of the rule of law” and that it needed to know that EU countries “are committed to honoring their laws.”

The Business Roundtable’s main complaint is that the European Commission overruled an Irish government policy that allowed Apple to funnel tens of billions in profits to a “head office” with no employees that paid taxes at a rate of 0.005 percent in 2014.

The depth of the Business Roundtable’s concern for the rule of law can be measured by the fact that all five of the companies whose CEOs appear on its letterhead have faced large, repeated sanctions from the U.S. government:

• Doug Oberhelman, the CEO of Caterpillar, is the Business Roundtable’s chairperson. Caterpillar has paid over $3 million in fines since 2010, including $2.55 million for a large scale violation of the Clear Air Act.

• Ursula Burns, the CEO of Xerox, is a Business Roundtable vice chair. Among various other misdeeds, Xerox engaged in a four-year scheme to defraud investors by overstating its pre-tax earnings by $1.5 billion.

• David M. Cote, the CEO of Honeywell, is a Business Roundtable vice chair. Honeywell has been fined by the federal government over 100 times since 2010, including an $11.8 million criminal fine for knowingly storing hazardous radioactive waste without a permit. In 2007 Honeywell pled guilty to negligently causing the release of hazardous chemicals that killed an employee, and paid an $8 million criminal fine plus $4 million in restitution to the employee’s children and community.

• Marillyn Hewson, CEO of Lockheed Martin, is a Business Roundtable vice chair. Lockheed has an extensive rap sheet, and paid $27.5 million in 2014 and $15.85 million in 2012 to the U.S. government for overcharging it for tools for use on military aircraft. In 2007 Lockheed agreed to repay the government $265 million for “accidental” overcharges on the Joint Strike Fighter program.

• Andrew N. Liveris, CEO of Dow Chemical, is a Business Roundtable vice chair. In addition to paying numerous government fines, Dow recently paid $835 million to settle a price fixing case. (Dow denied any wrongdoing.)

The Business Roundtable, an association of over 100 CEOs, was founded in 1972 to advance the political interests of large corporations. It is some ways a microcosm of the U.S. political system, with a politician (Engler is the former governor of Michigan) acting as the front man for the corporations that control it.

Apple, which has stashed over $181 billion in profits overseas to avoid U.S. taxes, is not a member of the Business Roundtable. However, Business Roundtable’s concern on the issue is understandable, given that the Fortune 500 companies all told have over $2.4 trillion sitting in other countries.

The Business Roundtable’s letter goes on to warn ominously that if the EU fails to rescind the EC’s decision, it will “promote tax uncertainty” with “the most direct consequences to be borne directly by EU countries and their citizens.” The Business Roundtable has previously identified numerous causes of “uncertainty” that it felt were damaging the U.S. economy, such as Obamacare and budget deficits, as well as “uncertainty in general.”

Top photo: Business Roundtable President and former Michigan Gov. John Engler participates in a news conference as part of a “Day of Action for Immigration Reform” at the U.S. Chamber of Commerce on July 9, 2014, in Washington, D.C.

Join The Conversation