On January 26, 2012, the European Commission announced that it had sent Belgium a reasoned opinion (second stage of the infringement procedure under article 258 of the Treaty on the Functioning of the European Union (TFEU)) requesting it to broaden its NID regime. NID is a tax deduction calculated on the equity of a Belgian company. Under the current calculation method for the NID, a correction of the equity is to be made for real estate and permanent establishments situated in another EU Member State. No such correction is required for Belgian real estate and PEs. The Commission, therefore, takes the view that the Belgian regime is incompatible with the freedom of establishment and the free movement of capital as included in the TFEU insofar it requires taxpayers to deduct PEs and real estate located in other EU member states. It should be noted that the Commission does not challenge the NID regime as such, only one of the corrections to the NID basis. If Belgium does not comply with the reasoned opinion within 2 months, the matter may be referred to the European Court of Justice.