The ECJ found that the freedom of movement of capital was breached by French domestic rules which provided that dividends paid by French companies to undertakings for collective investments in transferable securities (“UCITS”) in other Member States and third countries attracted withholding tax at a rate of 25, whilst dividends paid by French companies to a resident UCITS were exempt from tax.
The European Court of Justice has decided, without the need for an opinion from AG Sharpston, that Germany’s method of withholding taxation on company dividends infringes Art 56 EC.
Portuguese law exempted dividends paid to domestic pension funds from corporation tax whilst taxing dividends paid to non- resident corporation tax.
The European Court of Justice today handed down its judgment in Case C-31009 Accor.
This case concerns the Portuguese rules of taxation of dividends paid to pension funds.
The ECJ has handed down its decision in Prunus, reaching the same conclusion that Advocate-General Villalon did in December last year.
The European Commission has taken the second step in its infringement procedure by issuing a Reasoned Opinion requesting that the UK amend two tax anti abuse regimes which it considers to be discriminatory.
The Commission has also requested that Belgium amend its withholding tax rules in relation to foreign-source dividends received by Belgian residents.
Austrian provisions exempted domestic dividend income regardless of the size of the holding but only give an unconditional exemption in cross border situations if the holding was at least 10.
On 15 September 2010 the ECJ heard oral submissions in the joint cases of Haribo and Österreichische Salinen AG.