The Resource Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund

Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund

Label
Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund
Title
Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund
Creator
Subject
Language
eng
Summary
Comments on the opinion in the Aberdeen Fininvest Alpha Oy case. The Finnish Supreme Administrative Court (Korkein hallintooikeus, KHO ) referred to the ECJ the preliminary question, in essence, whether a Luxembourg SICAV is objectively comparable with a Finnish limited liability company or a Finnish investment fund. In the opinion Advocate General Mazák noted that the freedom of establishment (articles 43 and 48 EC) was applicable in the subject case, but also indicated that his view was the same in the case of application of the free movement of capital (article 56 EC). In order to determine whether the difference in treatment constituted a forbidden restriction of the freedom of establishment, it needed to be examined whether a Luxembourg SICAV (levy of dividend tax) was objectively comparable to a Finnish limited liability company or a Finnish investment fund (exemption from dividend tax). AG Mazák is of the opinion that the answer to this question can be derived from the Denkavit Internationaal (ECJ 14 December 2006, C-170/05) and Amurta (ECJ 8 November 2007, C-379/05) cases, in which the ECJ had established that as soon as a Member State imposes a tax not only on residents but also on non-residents, in respect of a dividend received from a resident company, the situation of non-resident shareholders becomes comparable to the situation of resident shareholders. If this case law is applied to the case at hand, the Finnish parent entities are objectively comparable to foreign parent entities, as both are, in principle, subject to taxation on the income in Finland, irrespective of the legal form of the foreign entity. The AG further noted that the purpose of the domestic exemption was to prevent multi-tier taxation on the profits of the Finnish distributing company, and that Finland, according to the case law of the ECJ, must extend this measure to nonresidents as it has applied tax jurisdiction over these non-residents. It is irrelevant that the Luxembourg SICAV is exempt from tax in Luxembourg
Citation source
In: Highlights & Insights on European taxation. - Deventer. - Vol. 2 (2009), no. 2 ; p. 51-59
http://library.link/vocab/creatorName
Fortuin, A
Geographic coverage
European Union
Language note
  • English
  • French
http://library.link/vocab/subjectName
  • SICAV
  • ECJ case law
  • fundamental freedoms
  • dividend withholding tax
Label
Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund
Instantiates
Publication
Label
Aberdeen Fininvest Alpha Oy : Finnish dividend tax levied in breach of EC law : Luxembourg SICAV objectively comparable to Finnish investment fund
Publication

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