CJEU – Recent Developments in Direct Taxation 2018

1. S. 60Introduction

In this paper I will discuss several pending cases regarding French tax law. The Picart case raises the question whether an exit tax may be considered contrary to the Agreement of 21 June 1999 between the European Union and Switzerland. The Marc Jacob and Marc Lassus cases involve the compatibility with the Merger Directive of a tax deferral on exchange of shares. The European Commission v French Republic case illustrates a situation where the French Administrative Supreme Court has been found to violate the principles of EU law as interpreted by a former decision of the European Court of Justice. The Sofina SA, Rebelco SA and Sidro SA case deals with whether a loss-making company may complain that a withholding tax on dividends infringes the freedom of capital movement.

2. The Picart case

2.1. Background

The facts of the case are the following: a French resident taxpayer moved his tax residence to Switzerland, where he continues to manage his interests in several companies which he controls. He was subject to an “exit tax” at the time of the transfer of residence in 2002. At that time, the “old” exit tax, which was to be considered inconsistent with EU law by the Laste...