Company: APTV
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001521332-25-000051
Chunk: 40

Company: Aptiv PLC
Filing Date: 2025-10-30
Form: 10-Q
Item: Item 1
Chunk 40
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2024 and approximately 5 points resulting from the Motional AD LLC (“Motional”) funding and ownership restructuring transactions, as described further in Note 21. Investment in Affiliates. There was no tax expense associated with the gain on the Motional transactions as Aptiv’s interest in Motional is exempt from capital gains tax in the jurisdiction in which it is owned. Aptiv PLC is a Swiss resident taxpayer and not a domestic corporation for U.S. federal income tax purposes. As such, it is not subject to U.S. tax on remitted foreign earnings and, as a result of its capital structure, is also generally not subject to Swiss tax on the repatriation of foreign earnings.Cash paid or withheld for income taxes was $208 million and $202 million for the nine months ended September 30, 2025 and 2024, respectively.

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On December 15, 2022, the European Union (the “E.U.”) Member States formally adopted the Pillar Two Framework (the “Framework”), which generally provides for a minimum effective tax rate of 15%, as established by the Organisation for Economic Co-operation and Development (the “OECD”). Many countries have enacted legislation consistent with the Framework effective at the beginning of 2024. The OECD continues to release additional guidance on these rules. The Company has proactively responded to these tax policy changes and will continue to closely monitor developments. Our effective tax rate for the nine months ended September 30, 2025 includes an unfavorable impact from the enacted Framework. On January 15, 2025, the OECD released Administrative Guidance (the “Guidance) on Article 9.1 of the Global Anti-Base Erosion Model Rules (the “Model Rules”) which amends the Pillar Two Framework. Jurisdictions that have adopted the Framework may implement and administer their domestic laws consistent with the Model Rules and Guidance. The Guidance eliminates the tax basis in certain deferred tax assets including tax credit carryforwards for purposes of the global minimum tax established under the Framework. As a result, the Company no longer expects to obtain significant benefits from the tax incentive granted to its Swiss subsidiary in 2023. Accordingly, the Company recognized an increase to valuation allowances of $294 million to reduce the related deferred tax asset during the nine months ended September 30, 2025. No other deferred tax assets are impacted by the Guidance. 

On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted