CJEU - Recent Developments in Direct Taxation 2020

S. 1341. Facts and legal Background

J&S Service UG, a German corporation, had to file for insolvency. An insolvency administrator was appointed. The insolvency administrator requested information from the tax administration in relation to the tax situation of J&S Service UG. He wanted to examine the possibility of bringing insolvency avoidance claims against the tax administration. In particular, he wanted to know the amount of taxes paid by J&S Service UG, when these taxes were paid and when the tax administration knew that J&S was in financial difficulties. According to German insolvency law, creditors are only entitled to a quota of their claims if the assets of the insolvent company are not sufficient to satisfy all creditors. Once an insolvency proceeding has started, the individual execution of the claims is no longer permissible. Payments by the debtor to creditors can be challenged and have to be paid back if the payments were made up to three months before the insolvency proceedings started, the debtor was already in financial difficulties and the creditor knew of these difficulties. In German insolvency proceedings, the government does not enjoy priority in relation to other creditors.

The insolvency administrator sought information on the basis of Sec. 4 of the Freedom Information Act of the Bundesland (state of) North Rhine-Westphalia. Sec. 32(e) GTA renders Sec. 32(c) GTA applicable for information requests on the basis of Freedom Information Acts of the Bundeslaender (states). Sec. 32(c) GTA limits the right of access to personal data held by the tax authorities when that data may be used to bring insolvency claims against tax authorities. Sec. 32(c) GTA contains exceptions for information requests which are based on the general data protection regulation (GDPR). Sec. 32(c) GTA is similar to Art. 23 GDPR. The purpose of this restriction is to put public authorities and private creditors on the same footing in insolvency proceedings as the GDPR (and the Freedom Information Act) cannot be invoked against private creditors. As a result of the application of Sec. 32(c) GTA, legal recourse regarding information requests in insolvency proceedings against public authorities has to be made to the civil courts. Due to the reference in Sec. 32(e) GTA, the same applies with regard to information requests on the basis of the Freedom Information Act of North Rhine-Westphalia.