On November 8, 2022, the Court of Justice of the European Union (CJEU), overturning the first instance EU General Court (General Court), annulled the European Commission’s (EC’s) decision that a Luxembourg tax ruling on Fiat’s intragroup financing transactions “did not reflect economic reality” and therefore amounted to unlawful state aid. [1] The CJEU, ruling in Grand Chamber composition, rejected the EC’s reliance on an “abstract” interpretation of the arm’s-length principle based on Organisation for Economic Co-operation and Development (OECD) principles. The CJEU concluded that this could not be relied upon in determining whether a measure conferred a “selective” advantage on Fiat (that is to say an advantage that was not generally available to all companies): Because EU member states have
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The EU Court of Justice annuls the Commission’s expansive interpretation of State aid in a Luxembourg tax rulings case (Fiat Chrysler)
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