# C_2016350EN.01002301.xml

| 26.9.2016 | EN | Official Journal of the European Union | C 350/23 |
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26.9.2016

EN

Official Journal of the European Union

C 350/23

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Action brought on 29 July 2016 — SJM Coordination Center v Commission

(Case T-420/16)

(2016/C 350/29)

Language of the case: English

Parties

Parties

Applicant: St. Jude Medical Coordination Center (SJM Coordination Center) (Zaventem, Belgium) (represented by: F. Louis and J. Ylinen, lawyers)

Applicant:

Defendant: European Commission

Defendant:

Form of order sought

Form of order sought

The applicant claims that the Court should:

| — | annul the Commission decision of 11 January 2016 on the excess profit exemption state aid scheme SA.37667 (2015/C) (ex 2015/NN) implemented by the Kingdom of Belgium; |
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annul the Commission decision of 11 January 2016 on the excess profit exemption state aid scheme SA.37667 (2015/C) (ex 2015/NN) implemented by the Kingdom of Belgium;

| — | alternatively, annul the contested decision to the extent that it includes the Applicant among the beneficiaries of the alleged aid scheme; |
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alternatively, annul the contested decision to the extent that it includes the Applicant among the beneficiaries of the alleged aid scheme;

| — | alternatively, annul the contested decision to the extent that it orders the recovery of any alleged aid amount from the Applicant; |
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alternatively, annul the contested decision to the extent that it orders the recovery of any alleged aid amount from the Applicant;

| — | order the Commission to pay the costs of the Applicant. |
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order the Commission to pay the costs of the Applicant.

Pleas in law and main arguments

Pleas in law and main arguments

In support of the action, the applicant relies on eight pleas in law.

| 1. | First plea in law, alleging a lack of competence.
  The Applicant puts forward that the Commission lacks competence to issue the contested decision and that the contested decision violates the principle of conferral limiting Union competences. |
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1.

First plea in law, alleging a lack of competence.

The Applicant puts forward that the Commission lacks competence to issue the contested decision and that the contested decision violates the principle of conferral limiting Union competences.

| 2. | Second plea in law, alleging a violation of the right to be heard.
  The Applicant puts forward that the Commission’s contradictory positions in its opening decision and in the contested decision have violated the right to be heard of the Applicant. |
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2.

Second plea in law, alleging a violation of the right to be heard.

The Applicant puts forward that the Commission’s contradictory positions in its opening decision and in the contested decision have violated the right to be heard of the Applicant.

| 3. | Third plea in law, alleging a wrong characterisation as an aid scheme.
  The Applicant puts forward that the contested decision erroneously concludes to the existence of a scheme, that the Commission’s approach violates its duty to conduct a comprehensive, diligent and impartial examination of the facts under investigation. |
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3.

Third plea in law, alleging a wrong characterisation as an aid scheme.

The Applicant puts forward that the contested decision erroneously concludes to the existence of a scheme, that the Commission’s approach violates its duty to conduct a comprehensive, diligent and impartial examination of the facts under investigation.

| 4. | Fourth plea in law, alleging an insufficient statement of reasons.
  The Applicant puts forward that the Commission does not appropriately state the reasons on which the contested decision was based. |
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4.

Fourth plea in law, alleging an insufficient statement of reasons.

The Applicant puts forward that the Commission does not appropriately state the reasons on which the contested decision was based.

| 5. | Fifth plea in law, alleging an erroneous finding of selectivity under Article 107(1) TFUE.
  The Applicant puts forward that the contested decision errs with regard to all three steps establishing selectivity in numerous ways: (i) Article 185(2)(b) of the Belgian Income Tax Code (‘Code des impôts sur les revenus 1992’ or ‘CIR’) and the excess profit rule cannot be excluded from from the system of reference; (ii) the ruling received by the Applicant derogates neither (a) from the arm’s length principle, nor (b) from Belgian corporate income tax system; and (iii) the alleged derogation would be justified by the need to avoid double taxation. |
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5.

Fifth plea in law, alleging an erroneous finding of selectivity under Article 107(1) TFUE.

The Applicant puts forward that the contested decision errs with regard to all three steps establishing selectivity in numerous ways: (i) Article 185(2)(b) of the Belgian Income Tax Code (‘Code des impôts sur les revenus 1992’ or ‘CIR’) and the excess profit rule cannot be excluded from from the system of reference; (ii) the ruling received by the Applicant derogates neither (a) from the arm’s length principle, nor (b) from Belgian corporate income tax system; and (iii) the alleged derogation would be justified by the need to avoid double taxation.

| 6. | Sixth plea in law, alleging a lack of advantage.
  The Applicant puts forward that the contested decision does not analyse the existence of an advantage. According to the Applicant, it has not received an advantage and any benefit to it is in line with the arm’s length principle lais down in Article 9 of the OECD Model Tax Convention, which Article 185(2) CIR introduces to Belgian law. |
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6.

Sixth plea in law, alleging a lack of advantage.

The Applicant puts forward that the contested decision does not analyse the existence of an advantage. According to the Applicant, it has not received an advantage and any benefit to it is in line with the arm’s length principle lais down in Article 9 of the OECD Model Tax Convention, which Article 185(2) CIR introduces to Belgian law.

| 7. | Seventh plea in law, alleging a violation of the principle of equal treatment.
  The Applicant puts forward that the contested decision violates the principle of equal treatment by (i) claiming that the arm’s length principle entitles tax administrations to increase the tax base of Multinational Enterprises (‘MNE’) and at the same time requiring a concrete risk of double taxation to allow for downward adjustments and (ii) limiting the analysis of an advantage to the level of the Belgian MNE entity. |
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7.

Seventh plea in law, alleging a violation of the principle of equal treatment.

The Applicant puts forward that the contested decision violates the principle of equal treatment by (i) claiming that the arm’s length principle entitles tax administrations to increase the tax base of Multinational Enterprises (‘MNE’) and at the same time requiring a concrete risk of double taxation to allow for downward adjustments and (ii) limiting the analysis of an advantage to the level of the Belgian MNE entity.

| 8. | Eighth plea in law, alleging a violation of the principles of legal certainty and legality.
  The contested decision infringes the principle of legal certainty by (i) breaking with case law and its own Commission previous practice and (ii) a lack of identification of the alleged advantage. |
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8.

Eighth plea in law, alleging a violation of the principles of legal certainty and legality.

The contested decision infringes the principle of legal certainty by (i) breaking with case law and its own Commission previous practice and (ii) a lack of identification of the alleged advantage.

| 9. | Ninth plea in law, alleging recovery results in double taxation.
  The Applicant puts forward that the contested decision errs to assume that there can be no double taxation concern, which would increase if the Applicant was ordered to pay any amount in the recovery process. According to the Applicant, the contested decision must therefore be annulled, to the extent that it orders Belgium to recover any amount from the Applicant. |
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9.

Ninth plea in law, alleging recovery results in double taxation.

The Applicant puts forward that the contested decision errs to assume that there can be no double taxation concern, which would increase if the Applicant was ordered to pay any amount in the recovery process. According to the Applicant, the contested decision must therefore be annulled, to the extent that it orders Belgium to recover any amount from the Applicant.

| 10. | Tenth plea in law, alleging that recovery cannot be subjected to commission discretion.
  The Applicant puts forward that the contested decision appears to grant the Commission discretionary power to reject adaptations of the taxpayer’s taxable basis based on actual factual circumstances at the time the Ruling was obtained. |
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10.

Tenth plea in law, alleging that recovery cannot be subjected to commission discretion.

The Applicant puts forward that the contested decision appears to grant the Commission discretionary power to reject adaptations of the taxpayer’s taxable basis based on actual factual circumstances at the time the Ruling was obtained.

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