The European Court of Justice with its decision in case C-285/07 held that the double carryover basis requirement imposed under German law to accord tax free treatment to the shareholders of the target corporation in a EU cross-border transfer of shares violates the EU mergers directive and EC law.
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With ruling n. 470/E of December 3, 2008 Italy’s tax authority extended non recognition treatment to a merger falling outside the scope of the EU mergers directive, facilitating the possibility to carry out cross-border reorganization involving Italian assets or Italian companies without immediate recognition of gain.
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European Court of Justice in Société Papillon (C-418/07) ruled that French national laws that limit access to tax consolidation in EU cross-border situations violate the EC Treaty. The ruling offers taxpayers opportunities to claim access to consolidation at the EU level every-time that such option is granted at domestic level and to offset losses and profits of the EU members of a consolidated group.
Continue Reading ECJ Ruled That Restrictions to Tax Consolidation Violate EC Treaty