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EU tax litigation Basic principles. Dr Adam Zalasi ński. Agenda. The infringements procedure The preliminary rulings The effects of EU tax litigation on the law making process in the Member States . Types of proceedings before the CJ. Contentious procedure
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EU tax litigationBasic principles Dr Adam Zalasiński
Agenda • The infringements procedure • The preliminary rulings • The effects of EU tax litigation on the law making process in the Member States
Types of proceedings before the CJ • Contentious procedure • Infringements actions under Art. 258 TFEU • Commission as the applicant – it brings MSs to the Court • Non-contentious procedure • Preliminary rulings under Art. 267 TFEU • Commission as ‘amicus curiae’ – it submits written observations and appears in hearings
Infringements procedure – an outline • Stages • Informal stage (EU-Pilot inquiry) • Administrative stage • Letter of formal notice • Reasoned opinion • Judicial stage - referral to the ECJ
Infringements procedure – legal nature • Objective nature of the infringement procedure: • It concerns ‘an objective finding of a failure to fulfil obligations and not on a proof of any criteria or opposition on the part of the Member States concerned’ (Case 301/81, Com v. Belgium) • It makes an objective assessment of the legality of the MS’s behaviour (no guilt/intention issue)
Preliminary ruling – an outline • Interpretation of EU law • Primary and secondary • Courts of last instance – obliged to refer a question • Courts of lower instances – entitled to refer a question • Validity of Community acts • Secondary law and decisions in individual cases (all domestic courts obliged to refer a question if they have doubts as to validity)
The effects of preliminary rulings on domestic tax law • Direct consequence: • Taxpayers’ rights are ensured within judicial control of tax administration’s decisions, • Indirect consequence: • National law maker should respond to the CJ’s ruling if domestic law does not conform with the interpretation of EU law by the CJ • If not – an infringement proceeding may be opened.
The effects of EU litigation on the law making process in the Member States • Empirical study (General Report for 2006 FIDE Congress) • MS frequently abolish more preferential domestic regimes instead of extending them to cross-border situations, or • Extend application of norms limiting taxpayers’ rights in cross-border situations to domestic cases