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2015-2 Reports of Cases before the Court of Justice and the Court of First Instance 1 (2015)

handle is hein.intyb/rcbjcofi0366 and id is 1 raw text is: ZReports of Cases Case C-172/13 European Commission V United Kingdom of Great Britain and Northern Ireland (Failure of a Member State to fulfil obligations - Article 49 TFEU - Article 31 of the EEA Agreement - Corporation tax - Groups of companies - Group relief- Transfer of losses sustained by a non-resident subsidiary - Conditions - Date to be used for determining whether the losses of the non-resident subsidiary are definitive) Summary - judgment of the Court (Grand Chamber), 3 February 2015 Freedom of establishment - Tax legislation - Corporation tax - Tax relief- Deduction of losses sustained by a non-resident subsidiary - National legislation setting the date for the assessment as to whether the losses sustained by that subsidiary may be characterised as definitive - Lawfulness (Art. 49 TFEU; EEA Agreement, Art. 31) A Member State, which establishes group relief arrangements under which losses sustained by a company may be offset against the profits of other companies belonging to the same group, where, unlike losses sustained by resident companies, those sustained by non-resident companies may be taken into account for the purposes of group relief only if they are characterised as definitive, has not failed to fulfil its obligations under Article 49 TFEU and Article 31 of the Agreement on the European Economic Area. In that regard, the losses may be characterised as definitive in a situation where, first, the non-resident subsidiary has exhausted the possibilities available in its State of residence of having the losses taken into account for the accounting period concerned by the claim for relief and also for previous accounting periods, and, secondly, there is no possibility for those losses to be taken into account in its State of residence for future periods either by the subsidiary itself or by a third party, in particular where the subsidiary has been sold to that third party. Furthermore, Article 49 TFEU and Article 31 of the EEA Agreement do not preclude the assessment as to whether the losses sustained by that non-resident company may be characterised as definitive from being made as at the time immediately after the end of the accounting period in which the losses were sustained. Losses sustained by a non-resident subsidiary may be characterised as definitive only if that subsidiary no longer has any income in its Member State of residence. In that respect, so long as that subsidiary continues to be in receipt of even minimal income, there is a possibility that the losses sustained may yet be offset by future profits made in the Member State in which it is resident. It is possible to show that losses sustained by a non-resident subsidiary may be characterised as definitive where, immediately after the end of the accounting period in which the losses have been sustained, that subsidiary ceased trading and sold or disposed of all its income producing assets. (see paras 21, 26, 31, 36, 37) ECLI:EU:C:2015:50

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