Apple has warned investors formally for the first time it could face “material” financial penalties from the EU Commission’s investigation into its tax arrangements with Ireland.

The warning is carried in Apple’s regular filing to the Securities and Exchange Commission, following reporting of first quarter financial results this week.

Under US securities rules, a material event is usually defined as 5 percent of a company’s pre-tax earnings for the past three years and according to the Financial Times, who broke the story, that could amount to $2.5bn.

Apple says in the filing: “If the European Commission were to conclude against Ireland, it could require Ireland to recover from the company past taxes covering a period of up to 10 years reflective of the disallowed State Aid and such amount could be material.” 

The Investigation launched last summer on basis that Ireland had given Apple “selective tax advantage” in two deals struck in 1991 and 2007.

Both Apple and the Irish Government have argued that the European Commission's case in weak - a ruling could be delivered in June.