Der Einfluss des unionsrechtlichen Beihilfenverbots auf das deutsche Steuerrecht

Friederike Grube

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Friederike Grube’s book, which is the result of her doctoral thesis, aims to shed light on recent developments in German tax law under the influence of EU law.

The study opens with a reminder of the distinction between direct and indirect taxation. As far as indirect taxation is concerned, Article 113 TFEU provides that national laws on indirect taxation shall be harmonised "to the extent that such harmonisation is necessary to ensure the establishment and functioning of the internal market and to avoid distortions of competition" (the addition of distortions of competition to the wording of Article 93 TEC dates back to the Treaty of Lisbon). According to settled case law of the Court of Justice of the EU, while direct taxation falls within the competence of the Member States, they must nevertheless exercise that competence in compliance with Union law (see also the Opinion of Advocate General Jääskinen in Joined Cases C-106/09 P and C-107/09 P: "The power to impose taxes remains an internal prerogative of governments, which may choose the most appropriate tax systems according to their preferences, subject to compliance with Union law" (pt 139).

Thus, national provisions in the field of direct taxation must be compatible with the fundamental freedoms set out in the TFEU. However, according to the case law of the Court, these do not require harmonisation of Member States’ tax systems.

However, EU competition law may have an impact on national rules in the field of direct taxation. For example, a large proportion of state aid is granted not in the form of direct subsidies but in the form of tax concessions. As a result, national tax law may be contrary to EU law.

Among the disputed tax advantages which Germany has granted, it has had to provide explanations in recent years concerning the ’reorganisation clauses’ (Sanierungsklauseln) provided for in Article 8c(1a) of the Körperschaftssteuergesetz (Law governing corporation tax) of 2002, introduced into that law following a legislative amendment in 2009 (available online: This provision of the Körperschaftssteuergesetz defines "reorganisation" as a measure that aims to prevent insolvency or overindebtedness while preserving the essential structures of the company (it is therefore more a reorganisation, but the official French translations of the provision refer to "assainissement"). However, in its decision of 26 January 2011, the Commission decided that the said insolvency clauses violated the prohibition on granting state aid: the measure could not be considered compatible with the internal market on the basis of Article 107(3)(b) or (c) of the TFEU (see IP/09/157). Commission Decision of 26 January 2011 on State aid C 7/10 (ex CP 250/09 and NN 5/10) granted by Germany under the reorganisation clause of the Corporate Tax Law (KStG, Sanierungsklausel), which has been the subject of numerous actions for annulment. The decision is available online: 32011D0527&from=EN).

That decision has given rise to a great deal of litigation, on which the Court of First Instance has still not ruled, with the exception of the order of 18 December 2012 in Case T-205/11 Germany v Commission (ECLI:EU:T:2012:704), which dismissed the action brought by the Federal Republic of Germany as inadmissible as it was brought after the expiry of the period prescribed for bringing an action. That order of inadmissibility was confirmed by order of 3 July 2014 in Case C-102/13 P (ECLI:EU:C:2014:2054).

However, no judgment has yet been delivered in Cases T-585/11, T-586/11, T-614/11, T-619/11, T-620/11, T-621/11, T-626/11, T-627/11, T-628/11 and T-629/11, all of which relate to the abovementioned decision (it may be assumed that with the planned doubling of the number of judges at the Union Court, such cases will be judged more quickly, especially as they are less complex than cartel cases). Each case involves actions for annulment brought against the decision in question by at least 15 undertakings. The publication of Friederike Grube’s book is therefore somewhat premature, since the impact of the EU’s dispute over "reorganisation clauses" on German tax law can only be assessed once the judgments of the Court of First Instance or, where appropriate, those of the Court of Justice on appeal have been delivered (some of these cases can, of course, be expected to be joined). The author also refrains from commenting on the likely outcome of these disputes and merely discusses the influence of the prohibition of state aid under EU law on "reorganisation clauses". On the other hand, lengthy developments are devoted, for example, to generalities on the (material or geographical) selectivity of national measures, which makes it possible to distinguish between purely fiscal general measures and specific prohibited measures.

Nor is the impact of the Union law ban on the granting of State aid on "binding information" (verbindliche Auskünfte, a kind of administrative doctrine by which the Administration takes an official position on a given issue) discussed in depth, but simply addressed. However, there is also a case pending before the European Court of Justice on the so-called "binding information" under German law, of which the author does not seem to be aware.

It is only from page 80 onwards, out of a total of 187, that one finds developments in German law, and in particular in the case law of the German Constitutional Court (Bundesverfassungsgericht). According to that case-law, the principles of the protection of legitimate expectations, proportionality and legal certainty derive from the principle of the rule of law. Those principles may be invoked against the recovery of State aid unless the decision granting the aid has been declared unlawful: German law is consistent with Union law on this point. Thus, again according to that German constitutional case-law, the general interest which governs the recovery of unlawful aid prevails over the principles of the protection of legitimate expectations, legal certainty and proportionality which are part of individual judicial protection.

Since the Commission analyses the reorganisation clauses as non-notified measures, they constitute, in accordance with its analysis, unlawful State aid. However, Friederike Grube’s analysis could, for example, have been deepened with regard to the lack of selectivity of the reorganisation clauses. Even in the conclusion, the author does not take a position on the selective or general nature of the latter and merely writes that the question remains open (p. 156).

In the end, this stimulating book only partially deals with the subject announced. How does the prohibition of state aid under EU law affect German tax law? Are there any developments that can already be observed or are they to be expected? What about comparative law?

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Athanase Popov, Der Einfluss des unionsrechtlichen Beihilfenverbots auf das deutsche Steuerrecht, February 2016, Concurrences N° 1-2016, Art. N° 77976, pp. 262-263

Publisher Internationaler Verlag Der Wissenschaften

Date 30 July 2014

Number of pages 157

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