The court followed the argument of the tax administration that in Ireland only administrative services have been rendered with no insurance or re-insurance activities. It ruled that those services can be rewarded at cost plus a modest mark up. The insurance risk does not require a separate remuneration. The remainder of the Irish insurance profit must be taxed at the Dutch resort.
The court also held that the investment income (i.e. the interest on the group loan) can be allocated to the Irish captive insurance company. The court came to this conclusion mainly because the Dutch tax administration had not separately argued why it should have been allocated to The Netherlands.