CJEU - Recent Developments in Direct Taxation 2025

1. Introduction

In the context of both the 2020 COVID-19 pandemic, 2022 energy crisis and subsequent massive government aid packages, government budgets have been under increasing pressure. The societal call for large profitable companies to pay their fair share when recovering the costs of these crises has been widely heard. Indeed, the recent (inter)national policy tendency has been to respond accordingly. This is evidenced by, for example, the introduction within the EU of an effective minimum tax rate of 15% on surplus profits by large domestic or multinational enterprises as of 1 January 2024 (Pillar Two Directive or P2D). Another example is the temporary solidarity contribution for the years 2022 and/or 2023 levied on surplus profits realized by enterprises in the extractive industry.

This chapter discusses the recently decided Fugro case, C-146/24 P, in which the top-up tax under the Pillar Two Directive has been disputed by an individual shipping company before the CJEU. The case is technically complex and challenging. In order to be able to properly place this case in the right legal context, it is helpful to highlight three features. First of all, the case concerns the EU c...