The European Union has today launched a probe into US fast food giant McDonald's tax deals with Luxembourg, widening an investigation into tax dodging by major multinationals.
The European Commission, the EU's competition regulator, "has opened a formal probe into Luxembourg's tax treatment of McDonald's," a statement said.
The case against one of the world's most iconic companies adds to a series of probes launched last year following the LuxLeaks affair.
This revealed that top global companies had negotiated lower tax rates, in some cases as low as 1%, in secret pacts with Luxembourg.
"A tax ruling that agrees to McDonald's paying no tax on their European royalties either in Luxembourg or in the US has to be looked at very carefully under EU state aid rules," EU Competition Commissioner Margrethe Vestager said in the statement.
Tax deals between EU member states and companies - known as tax rulings - are not in themselves illegal and the firms involved insist they fully comply with the tax laws where they operate.
But they have run afoul of the European Commission's tough rules on state aid, which are designed to ensure fair competition for all.
In October, the European Union ordered coffee shop chain Starbucks and Fiat to each repay up to €30m in back taxes.
Brussels said tax deals that the Netherlands offered US coffee giant Starbucks and Luxembourg gave Italian automaker Fiat were illegal, dealing its first major blow to big business in a campaign against sweetheart tax arrangements.
Decisions on Apple in Ireland and Amazon, also in Luxembourg, are also expected early next year.
