# C_2006178EN.01001502.xml

| 29.7.2006 | EN | Official Journal of the European Union | C 178/15 |
| --------- | -- | -------------------------------------- | -------- |

---

Reference for a preliminary ruling from the Hoge Raad der Nederlanden lodged on 26 April 2006 — Staatssecretaris van Financiën v Orange European Smallcap Fund NV

(Case C-194/06)

(2006/C 178/25)

Language of the case: Dutch

Referring court

Hoge Raad der Nederlanden

Parties to the main proceedings

Applicant: Staatssecretaris van Financiën

Defendant: Orange European Smallcap Fund NV

Question(s) referred

| 1. | Must Article 56 EC, in conjunction with Article 58(1) EC, be interpreted as meaning that the prohibition in Article 56 EC is incompatible with a rule in a Member State under which — for the reasons set out in at the end of section 5.2.1 of this judgment — a concession to be granted to a fiscal investment enterprise on account of taxation at source deducted in another Member State from dividends received by the fiscal investment enterprise is restricted:
(a)
to the amount which a natural person resident in the Netherlands could have had credited on the basis of a tax treaty concluded with the other Member State; (b)
where and to the extent to which the shareholders of the fiscal investment enterprise are not natural persons resident in the Netherlands or bodies subject to Netherlands corporation tax? | (a) | to the amount which a natural person resident in the Netherlands could have had credited on the basis of a tax treaty concluded with the other Member State; | (b) | where and to the extent to which the shareholders of the fiscal investment enterprise are not natural persons resident in the Netherlands or bodies subject to Netherlands corporation tax? |
| --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------ | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| (a) | to the amount which a natural person resident in the Netherlands could have had credited on the basis of a tax treaty concluded with the other Member State; | | | | |
| (b) | where and to the extent to which the shareholders of the fiscal investment enterprise are not natural persons resident in the Netherlands or bodies subject to Netherlands corporation tax? | | | | |

| 2. | If the answer to Question 1 is wholly or partly in the affirmative:
(a)
Does ‘direct investment’ in Article 57(1) EC also include the holding of a block of shares in a company if the holder of the shares holds them only as an investment and the size of the block does not put the holder in a position to exercise a decisive influence over the management or control of the company? (b)
Under Article 56 EC, is any restriction of the movement of capital connected with the levying of tax that would be impermissible if it related to cross-border movement of capital within the EC similarly impermissible in the case of the same movement of capital — in otherwise similar circumstances — to and from third countries? (c)
If the answer to Question 2(b) is in the negative, must Article 56 EC then be interpreted as meaning that a restriction by a Member State of a tax concession granted to a fiscal investment enterprise with regard to taxation at source of a dividend received from a third country, that restriction being based on the fact that not all shareholders of the fiscal investment enterprise have their place of residence in the Member State concerned, is incompatible with that article? | (a) | Does ‘direct investment’ in Article 57(1) EC also include the holding of a block of shares in a company if the holder of the shares holds them only as an investment and the size of the block does not put the holder in a position to exercise a decisive influence over the management or control of the company? | (b) | Under Article 56 EC, is any restriction of the movement of capital connected with the levying of tax that would be impermissible if it related to cross-border movement of capital within the EC similarly impermissible in the case of the same movement of capital — in otherwise similar circumstances — to and from third countries? | (c) | If the answer to Question 2(b) is in the negative, must Article 56 EC then be interpreted as meaning that a restriction by a Member State of a tax concession granted to a fiscal investment enterprise with regard to taxation at source of a dividend received from a third country, that restriction being based on the fact that not all shareholders of the fiscal investment enterprise have their place of residence in the Member State concerned, is incompatible with that article? |
| --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| (a) | Does ‘direct investment’ in Article 57(1) EC also include the holding of a block of shares in a company if the holder of the shares holds them only as an investment and the size of the block does not put the holder in a position to exercise a decisive influence over the management or control of the company? | | | | | | |
| (b) | Under Article 56 EC, is any restriction of the movement of capital connected with the levying of tax that would be impermissible if it related to cross-border movement of capital within the EC similarly impermissible in the case of the same movement of capital — in otherwise similar circumstances — to and from third countries? | | | | | | |
| (c) | If the answer to Question 2(b) is in the negative, must Article 56 EC then be interpreted as meaning that a restriction by a Member State of a tax concession granted to a fiscal investment enterprise with regard to taxation at source of a dividend received from a third country, that restriction being based on the fact that not all shareholders of the fiscal investment enterprise have their place of residence in the Member State concerned, is incompatible with that article? | | | | | | |

| 3. | Is the answer to the above questions affected by whether:
(a)
the tax deducted in another country from the dividend received from that country is higher than the tax on the payment of that dividend to foreign shareholders in the Member State of establishment of the fiscal investment enterprise; (b)
the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in a country with which the above-mentioned Member State has a treaty providing for reciprocal credit of taxation of dividends at source; (c)
the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in another country of the EC? | (a) | the tax deducted in another country from the dividend received from that country is higher than the tax on the payment of that dividend to foreign shareholders in the Member State of establishment of the fiscal investment enterprise; | (b) | the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in a country with which the above-mentioned Member State has a treaty providing for reciprocal credit of taxation of dividends at source; | (c) | the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in another country of the EC? |
| --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |
| (a) | the tax deducted in another country from the dividend received from that country is higher than the tax on the payment of that dividend to foreign shareholders in the Member State of establishment of the fiscal investment enterprise; | | | | | | |
| (b) | the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in a country with which the above-mentioned Member State has a treaty providing for reciprocal credit of taxation of dividends at source; | | | | | | |
| (c) | the shareholders of the fiscal investment enterprise who have their place of residence outside the Member State of establishment of the fiscal investment enterprise are resident or established in another country of the EC? | | | | | | |

---