Apple invests in European datacentres as EU investigates tax break

Apple is investing €1.7bn in two European datacentres to support iTunes, the App Store, iMessage, Maps and Siri.

The investment comes at a time when the EU is investigating whether a corporation tax deal between Apple and the Irish government amounts to state aid.

The two datacentres each measure 166,000 square metres and will be located in Ireland and Denmark.

Apple said both will run on 100% renewable energy.

The facilities, located in County Galway, Ireland, and Denmark’s central Jutland, are expected to go online in 2017.

In Denmark, Apple said it is aiming to eliminate the need for additional generators by locating the datacentre adjacent to one of Denmark’s largest electrical substations. 

The facility is also designed to capture excess heat from equipment inside the facility and conduct it into the district heating system to help warm homes in the neighbouring community.

In Ireland, Apple said it would recover land previously used for growing and harvesting non-native trees and restore native trees to Derrydonnell Forest.

Apple CEO Tim Cook said the "significant new investment" represents Apples biggest project in Europe to date.

"We’re thrilled to be expanding our operations, creating hundreds of local jobs and introducing some of our most advanced green building designs yet," he said.

The datacentre investment comes just a few months after the EU said it would be investigating a tax deal between Apple and the Irish government. Due to the way it declares overseas sales, Apple pays only 2% corporation tax in Ireland.

Competitions Commissioner Joaquín Almunia wrote a letter which stated: "In the light of the foregoing considerations, the commission’s preliminary view is that the tax ruling of 1990 (effectively agreed in 1991) and of 2007 in favour of the Apple group constitute state aid."

In 2014, Apple chief financial officer Luca Maestri denied Apple agreed to bring jobs to Ireland in exchange for preferential tax treatment.

But the company now said it supports nearly 672,000 European jobs, including 530,000 jobs directly related to the development of iOS apps and employs 18,300 people across 19 European countries. 

Apple spent more than €7.8bn with European companies and suppliers helping build Apple products and support operations around the world.