Opinion of the Advocate General — ECLI:EU:C:2023:92
Date: 2023-02-09
Language of the case: German
Subject matter: Development cooperation;External relations;Principles, objectives and tasks of the Treaties
Procedure: Reference for a preliminary ruling
Origin: Germany

Summary C-15/22 – 1 
Case C-15/22 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged: 
6 January 2022 
Referring court: 
Bundesfinanzhof (Germany) 
Date of the decision to refer: 
13 July 2021 
Applicant and appellant on a point of law: 
RF 
Defendant and respondent in the appeal on a point of law: 
Finanzamt G 
  
Subject matter of the main proceedings 
National administrative practice of exempting salary paid in respect of an activity 
in the field of development assistance from taxation, provided that the activity is 
financed using funds from German authorities, while salary paid in respect of such 
an activity financed using EU funds is subject to taxation – compatibility with EU 
law 
Subject matter and legal basis of the request 
Interpretation of EU law, Article 267 TFEU 
Question referred for a preliminary ruling 
Are Article 4(3) of the Treaty on European Union and Article 208 in conjunction 
with Article 210 of the Treaty on the Functioning of the European Union to be 
interpreted as precluding a national administrative practice according to which tax 
is not waived in cases where a development cooperation project is financed by the 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-15/22 
 
2  
European Development Fund, while salary that a worker earns from a current 
employment relationship in respect of an activity associated with German official 
development assistance within the framework of technical or financial cooperation 
that is financed to at least 75% by a Federal Ministry responsible for development 
cooperation or else by a state-owned private development assistance association 
is, in certain conditions, exempted from taxation? 
Provisions of EU law relied on 
The second sentence of Article 3(5) TEU and Article 4(3) TEU 
Article 4(3) TFEU and Article 208 TFEU, in conjunction with Article 210 TFEU 
Provisions of national law relied on 
Einkommensteuergesetz (German Law on income tax; ‘the EStG’), specifically 
Paragraph 34c, point 5 
Auslandstätigkeitserlass (Edict on employment abroad; ‘the ATE’) (letter from the 
Federal Ministry of Finance of 31 October 1983, Federal Tax Gazette 
(Bundessteuerblatt; ‘the BStBl’) 1983 I p. 470) 
Succinct presentation of the facts and procedure in the main proceedings 
1 In the period from 12 April 2009 to 31 October 2012, the applicant and appellant 
in the appeal on a point of law (‘the applicant’) was employed as a project 
manager by a development assistance association having its registered office in 
Germany. She worked in Africa under the Micro-Projects Programme on a fixed-
term contract of employment lasting the duration of the project. During that 
period, the applicant’s place of residence and centre of interests was in Germany, 
while her place of employment was in Africa. 
2 As the project was not funded by Germany, but rather by the European 
Development Fund, the defendant tax office charged the applicant’s salary to 
income tax. Since her objection and action before the Finanzgericht (Finance 
Court, Germany) were unsuccessful, the applicant now seeks to have her salary 
exempted from income tax by way of her appeal on a point of law before the 
referring court. 
FINANZAMT G 
 
3 
Succinct presentation of the reasoning in the request for a preliminary ruling 
Assessment on the basis of national law 
3 Under national law, the applicant is not entitled to have her salary exempted from 
income tax pursuant to Paragraph 34c, point 5 of the EStG, in conjunction with 
the ATE. 
4 Under Paragraph 34c, point 5 of the EStG, the German tax authorities may waive 
the German income tax due on foreign income where this is economically 
expedient. According to the case-law of the German courts, this condition is 
satisfied only if the tax relief serves the purposes of German foreign trade. 
5 Paragraph I, point 4 of the ATE states that, inter alia, activities carried out abroad 
for a national contractor in connection with German official development 
assistance within the framework of technical or financial cooperation enjoy an 
exemption from tax. The defendant tax office interpreted the phrase ‘German 
official development assistance’ as referring only to development assistance 
measures that are funded directly from the German budget. This interpretation is 
not only possible, but, in view of the aforementioned purpose of Paragraph 34c, 
point 5 of the EStG, it is also obvious and in no way arbitrary. 
Compatibility with EU law 
6 It is questionable as to whether Article 4(3) TEU and Article 208 in conjunction 
with Article 210 TFEU give rise to an obligation to include development 
assistance measures financed using the European Development Fund – and thus 
only indirectly from the German budget – under Paragraph 34c, point 5 of the 
EStG, in conjunction with the ATE. 
7 The applicant claims that the principle of sincere cooperation set out in 
Article 4(3) TEU and the obligation of the European Union and the Member 
States to coordinate their development policy (the second sentence of Article 3(5) 
TEU) give rise to an obligation to include projects financed using EU funds, and 
therefore only partially and indirectly using German funds. 
8 While it is true that the principle of sincere cooperation set out in Article 4(3) 
TEU obliges the Union and the Member States, in full mutual respect, to assist 
each other in carrying out the tasks provided for by the Treaties (judgment of 
5 December 2017, Germany v Council, C-600/14, EU:C:2017:935, 
paragraph 105), Article 4(3) TFEU explicitly states that, in the area of 
technological development, inter alia, the Union has competence to carry out 
activities; however, the exercise of that competence shall not result in Member 
States being prevented from exercising theirs. In this regard, it is evident that 
Germany may adopt its own development assistance measures in consideration of 
their ‘economic expediency’ from a German perspective, provided that this does 
not compromise or adversely affect the objectives of EU development policy. 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-15/22 
 
4  
9 Nor should an obligation to include projects financed by the Union from the point 
of view of the principle of sincere cooperation follow from the judgment of 
16 December 2004, My, C-293/03, EU:C:2004:821. The present case differs from 
the one that gave rise to that judgment in so far as there should be no EU law 
comparable to the Staff Regulations of Officials of the European Communities 
under which Germany could be obliged, in a sufficiently precise and 
unconditional manner, to include projects financed by the Union in the support 
measures for which Germany is itself competent under Article 4(3) TFEU. 
Therefore, the applicant should not be entitled to a subjective right, based on the 
obligation of sincere cooperation, to have projects financed by the Union included 
in the benefits under Paragraph 34c, paragraph 5, of the EStG, in conjunction with 
the ATE. 
10 In the view of the referring court, such a right does not follow from Article 4(4) 
TFEU, in conjunction with the second sentence of Article 208(1) TFEU, or the 
first and third sentences of Article 210(1) TFEU. Article 4(4) TFEU also 
explicitly states that, although the competence of the Union in the field of 
development cooperation does extend to carrying out activities and conducting a 
common policy, the exercise of that competence does not result in Member States 
being prevented from exercising their own competence in this area. Although EU 
policy and the policy of the Member States in the field of development 
cooperation do complement and reinforce one another in this way (the second 
sentence of Article 208(1) TFEU) and an obligation to coordinate and provide 
support does follow from the first and third sentences of Article 210(1) TFEU, this 
should not result in Germany being denied the possibility of carrying out its own 
activities in the area of development policy in support of German foreign trade. 
11 Nothing different should follow from the Partnership agreement between the 
members of the African, Caribbean and Pacific Group of States of the one part, 
and the European Community and its Member States, of the other part, signed in 
Cotonou on 23 June 2000 (OJ L 317, 15.12.2000, p. 3-353). It is not reasonable to 
assume that, by ratifying the agreement, the German legislature could at the same 
time have also decided that the development cooperation work, namely the micro-
projects based on that agreement, was (also) expedient for (German) economic 
reasons. This is quite evident when one considers that the activities carried out on 
the basis of the agreement are precisely not those of German development policy; 
even though the share of financing Germany pays to the European Development 
Fund is significant, those funds ultimately come from the German budget, and are 
then indirectly used to finance the activities under the agreement. In any event, the 
agreement should not give rise to a subjective right on the part of a worker 
employed on a development assistance project covered by the agreement but 
residing in Germany to have his or her employment income exempted from 
taxation in Germany. 
12 The judgment of 28 February 2013, Petersen, C-544/11, EU:C:2013:124 does not 
support any other conclusion. Although in that judgment the Court held that 
Article 45 TFEU (freedom of movement for workers) must be interpreted as 
FINANZAMT G 
 
5 
precluding national legislation of a Member State pursuant to which income 
received for employment activities by a taxpayer who is resident in that Member 
State and has unlimited tax liability is exempt from income tax if the employer is 
established in that Member State, but is not so exempt if that employer is 
established in another Member State, it does not follow from this that Germany is 
obliged to include projects financed using EU funds, because, in the present case, 
no worker or employer is placed in a less favourable position in connection with 
their origin in another EU country. In any event, in so far as the ATE is liable to 
dissuade workers from taking up employment with an employer who manages a 
development assistance project financed using EU funds rather than national 
funds, this does not constitute a prohibited restriction to the fundamental rights of 
freedom of movement for workers or the freedom to provide services.