CJEU - Recent Developments in Direct Taxation 2025

1. Introduction

This case concerns the validity of a decision by the Norwegian Tax Appeals Board (Skatteklagenemnda) regarding Telenor Mobile Holding AS (TMH) for the 2013 fiscal year. The dispute arose from the tax treatment of a capital gain realized in connection with an intragroup transfer of shares within the Telenor Group. The main question for the Oslo District Court (first instance court) was whether denying TMH access to the group transfer rules amounted to a violation of EEA law.

2. Facts of the case

TMH, a wholly owned Norwegian subsidiary of Telenor ASA, sold 100% of the shares in Telenor Montenegro GSM to another group company, Telenor A/S (Telenor Denmark), in December 2013. Both companies were resident in different EEA states-TMH in Norway and Telenor Denmark in Denmark. The transaction generated a capital gain of NOK 1,796 billion. The purchase price was settled through a five-year intercompany receivable (seller’s credit) rather than cash. Since Montenegro was considered a low-tax jurisdiction outside the EEA, the Norwegian participation exemption method under section 2-38 of the Norwegian Tax Act did not apply, and the gain was, in principle, taxable in Norway.

TMH cl...