# C_2017437EN.01001902.xml

| 18.12.2017 | EN | Official Journal of the European Union | C 437/19 |
| --- | --- | --- | --- |

18.12.2017

EN

Official Journal of the European Union

C 437/19

---

Request for a preliminary ruling from the Conseil d’État (France) lodged on 28 September 2017 — Sofina SA, Rebelco SA, Sidro SA v Ministre de l’Action et des Comptes Publics

(Case C-575/17)

(2017/C 437/23)

Language of the case: French

Referring court

Referring court

Conseil d’État

Parties to the main proceedings

Parties to the main proceedings

Applicants: Sofina SA, Rebelco SA, Sidro SA

Applicants:

Defendant: Ministre de l’Action et des Comptes Publics

Defendant:

Questions referred

Questions referred

| 1. | Must Articles 56 and 58 of the Treaty establishing the European Community, now Articles 63 and 65 of the Treaty on the Functioning of the European Union, be interpreted as meaning that the cash-flow disadvantage resulting from the application of withholding tax to dividends paid to loss-making non-resident companies, while loss-making resident companies are not taxed on the amount of the dividends they receive until the year when, if at all, they return to a surplus, constitutes in itself a difference in treatment characterising a restriction on the free movement of capital? |
| --- | --- |

1.

Must Articles 56 and 58 of the Treaty establishing the European Community, now Articles 63 and 65 of the Treaty on the Functioning of the European Union, be interpreted as meaning that the cash-flow disadvantage resulting from the application of withholding tax to dividends paid to loss-making non-resident companies, while loss-making resident companies are not taxed on the amount of the dividends they receive until the year when, if at all, they return to a surplus, constitutes in itself a difference in treatment characterising a restriction on the free movement of capital?

| 2. | Must the potential restriction on the free movement of capital referred to in the preceding question, in view of the requirements resulting from Articles 56 and 58 of the Treaty establishing the European Community, now Articles 63 and 65 of the Treaty on the Functioning of the European Union, be regarded as being justified by the need to ensure the effective collection of tax, since non-resident companies are not subject to the supervision of the French tax authorities, or by the need to safeguard the allocation of the power to impose taxes between the Member States? |
| --- | --- |

2.

Must the potential restriction on the free movement of capital referred to in the preceding question, in view of the requirements resulting from Articles 56 and 58 of the Treaty establishing the European Community, now Articles 63 and 65 of the Treaty on the Functioning of the European Union, be regarded as being justified by the need to ensure the effective collection of tax, since non-resident companies are not subject to the supervision of the French tax authorities, or by the need to safeguard the allocation of the power to impose taxes between the Member States?

| 3. | If application of the withholding tax at issue may in principle be allowed with regard to the free movement of capital:






  — | do those provisions preclude the collection of withholding tax on dividends paid by a resident company to a loss-making non-resident company of another Member State where the latter ceases to trade without returning to a surplus, while a resident company placed in that situation is not taxed on such dividends? |
| --- | --- | --- |

3.

If application of the withholding tax at issue may in principle be allowed with regard to the free movement of capital:

—

do those provisions preclude the collection of withholding tax on dividends paid by a resident company to a loss-making non-resident company of another Member State where the latter ceases to trade without returning to a surplus, while a resident company placed in that situation is not taxed on such dividends?

| — | must those provisions be interpreted as meaning that where taxation rules apply which treat dividends differently depending on whether they are paid to residents or non-residents, it is appropriate to compare the actual tax burden borne by each of them in respect of those dividends, so that a restriction on the free movement of capital resulting from the fact that those rules preclude for non-residents alone the deduction of expenses which are directly linked to the actual payment of the dividends may be regarded as being justified by the difference in the rate of tax between the ordinary-law tax payable in a subsequent year by residents and the withholding tax levied on dividends paid to non-residents, where that difference compensates, with regard to the amount of tax paid, for the difference in the tax base? |
| --- | --- |

—

must those provisions be interpreted as meaning that where taxation rules apply which treat dividends differently depending on whether they are paid to residents or non-residents, it is appropriate to compare the actual tax burden borne by each of them in respect of those dividends, so that a restriction on the free movement of capital resulting from the fact that those rules preclude for non-residents alone the deduction of expenses which are directly linked to the actual payment of the dividends may be regarded as being justified by the difference in the rate of tax between the ordinary-law tax payable in a subsequent year by residents and the withholding tax levied on dividends paid to non-residents, where that difference compensates, with regard to the amount of tax paid, for the difference in the tax base?

---