Opinion of the Advocate General — ECLI:EU:C:2012:391
Date: 2012-06-28
Language of the case: Portuguese
Subject matter: Taxation
Procedure: Action for failure to fulfil obligations - successful;Action for failure to fulfil obligations - inadmissible
Origin: Portugal

summary form, the legal and factual particulars on which those complaints are based. (14) 19. However, in the present case the Commission has not stated, in its application any more than in its reasoned opinion, even briefly, any plea in law in support of its claim that taxation of the members of a company transferring its registered office and effective management out of Portugal infringes Article 43 EC. 20. In my view, such a statement would have been all the more necessary since the taxation of a company or a permanent establishment should not be confused with the taxation of its members and the implications of any infringement of Article 43 EC by the company transferring its registered office and effective management on account of the taxation of its members could depend on the place of residence of the members, according to whether they are domiciled in the territory of the European Union or in the territory of non-member countries. 21. In addition, none of the Member States which have intervened in support of the forms of order sought by the Portuguese Government has commented on the alleged failure to fulfil obligations stemming from Article 76 C of the CIRC, whilst the Netherlands Government, in particular, stated, in response to the written question asked by the Court, that it was not in a position to take a view on the situation of members in the light of National Grid Indus because of the brief information contained in the procedural documents in the present case. 22. I therefore suggest that the Court rule on the merits of the action only in so far as it seeks a declaration of an infringement of Article 43 EC, on the ground that the Portuguese Republic immediately taxes unrealised capital gains relating, first, to assets of Portuguese companies transferring their registered office and effective management to another Member State and, second, to assets assigned to a Portuguese permanent establishment of a non-resident company where those assets are transferred out of Portuguese territory or in the case of the cessation of that permanent establishment’s activity. B – Merits 1. Immediate taxation of unrealised capital gains relating to assets of a Portuguese company transferring its registered office and effective management to another Member State (Article 76 A of the CIRC) a) Summary of the arguments of the parties 23. The Commission takes the view that Article 76 A of the CIRC constitutes an impediment to freedom of establishment because it places companies which exercise that freedom in a manifestly less favourable position as far as liquid assets are concerned than companies which transfer their place of management without leaving Portuguese territory. Under the Portuguese legislation, the transfer of a company’s place of management to another Member State means that unrealised capital gains will be taxed immediately. 24. In the Commission’s view, if the principle of proportionality is not observed, this difference in treatment cannot be justified either by the need to ensure special protection of the rights of certain interested persons, in particular creditors, or by the objective – which is also legitimate – of ensuring effective fiscal supervision and combating tax avoidance. In this regard, whilst recognising a Member State’s legitimate right to tax capital gains generated at a time when the taxable person concerned came under its fiscal sovereignty, the Commission considers that a measure less harmful to freedom of establishment would be to defer recovery of the tax to the time when the capital gains are realised. The Member States would have adequate mutual assistance mechanisms under EU law to allow them to obtain information on taxation and to recover the tax claims of companies which have their place of management in other Member States. 25. In its response to the written question asked by the Court, the Commission also claims that, in the light of the abovementioned judgment in National Grid Indus, Article 76 A of the CIRC is manifestly incompatible with Article 43 EC. 26. Pointing out that the abovementioned judgment in National Grid Indus has direct relevance to the situation of a company incorporated under Portuguese law which, whilst retaining its legal personality, transfers its registered office and effective management to another Member State, without keeping a permanent establishment in Portugal, the Portuguese Government acknowledges, in the light of that judgment and contrary to its previous claims in its written pleadings, that freedom of establishment is applicable to the situation of such a company. 27. It does, however, contest the existence of a restriction of that freedom. 28. It argues that the same principle and the same taxable events apply irrespective of whether the transfer of the registered office and effective centre of management takes place in Portugal or in another Member State. It thus follows from Article 43(2) and (3) of the CIRC that unrealised capital gains relating to assets are taxed, in the light of the market value of those individual assets, each time that the taxable person effects the ‘permanent connection of those assets to purposes other than the activity carried on’, that is to say where those assets of the company are withdrawn from the taxable-income-generating economic activity which it carried on up to then. Taxation of capital gains is therefore applicable not only where they are effectively realised through a transfer for a consideration, but also in the case of unrealised capital gains whenever, outside the context of a sales transaction or negotiation and therefore without a consideration, assets cease to be connected, for whatever reason, to the exercise of the enterprise’s activity. 29. The Portuguese Government also stresses that the national legislation prescribes, including in purely domestic cases, registration for tax purposes of unrealised capital gains and losses concerning the individual assets concerned, during the financial year in which the events in question took place, even though in none of these cases the company obtains liquid assets from the realisation of the assets in return for their disposal. Unrealised capital gains are therefore registered each time that the assets concerned are no longer connected to the enterprise and to the income-generating economic activity which is liable to tax in national territory. Thus, companies which exercise their freedom of establishment are not subject to any earlier or greater tax burden than companies which continue to be established in Portugal. 30. In any event, supposing that Article 76 A of the CIRC entails a restriction of freedom of establishment, the Portuguese Government argues that immediate taxation of unrealised capital gains of a company transferring its place of management to another Member State is necessary in order to achieve the objectives of safeguarding the allocation of powers of taxation between the Member States, effectiveness of fiscal supervision and combating tax evasion and tax avoidance. 31. As regards the proportionality of immediate taxation of unrealised capital gains when a company’s registered office and effective management are transferred to another Member State, the Portuguese Government concedes, however, in its response to the written question asked by the Court, that if the Court should establish the existence of a restriction of freedom of establishment in the present case, the Portuguese Republic would be required to amend Article 76 A of the CIRC so as to give the companies concerned the choice to opt for either immediate payment or deferred recovery of the tax in question, in accordance with the abovementioned judgment in National Grid Indus. 32. Whilst most of the interveners contested the applicability of Article 43 EC in their respective statements in intervention, they now acknowledge, like the Portuguese Government, that, following the abovementioned judgment in National Grid Indus, freedom of establishment is applicable to the situation governed by Article 76 A of the CIRC. The German Government stresses that that judgment did not resolve the question of the applicability of freedom of establishment in the case of a company established in a Member State which adheres to the real seat theory and which makes the transfer of effective management subject to the winding-up of the company. 33. In any case, the Danish, German, Spanish, French and Swedish Governments consider that, even after the abovementioned judgment in National Grid Indus, immediate taxation of unrealised capital gains in the situation covered by Article 76 A of the CIRC is justified by one or more of the objectives in the public interest put forward by the Portuguese Republic. These interveners observe that the National Grid Indus case concerned an atypical situation where the company which transferred its effective management was taxed on an unrealised capital gain relating to a single financial asset. The Court’s findings relating to the disproportionate character of immediate taxation of such a capital gain when the effective management of National Grid Indus BV (‘National Grid Indus’) was transferred to the United Kingdom do not therefore apply to more common situations in which the transfer of a company’s place of management to another Member State involves non-financial assets, such as capital equipment or intangible goods, which are not intended to be transferred. The Spanish Government adds that offering companies the possibility to opt for deferred recovery of tax, subject to the requirement of an adequate bank guarantee, as the Court ruled in the abovementioned judgment in National Grid Indus, does not necessarily constitute a solution which is less harmful to freedom of establishment than immediate payment of the tax upon exit. The German Government states that it is for the national legislature to decide the appropriate solution itself, without forcing it to grant the taxpayer a right of option. In the view of that Member State, it is less restrictive and more effective to grant the taxpayer a right to spread tax payments rather than a suspension until the effective realisation of the assets. 34. By contrast, the Netherlands Government claims, in its response to the written question asked by the Court, that it follows from the abovementioned judgment in National Grid Indus that the Member States must always offer companies which transfer their place of management to another Member State a choice between immediate payment of tax on unrealised capital gains on exit and deferred payment when the assets are realised. b) Analysis 35. As all the parties to the present case point out, the abovementioned judgment in National Grid Indus allows the first complaint concerning an alleged failure to fulfil obligations to be settled to a large degree. 36. In that case, National Grid Indus, a limited liability company incorporated under Netherlands law, had a claim, expressed in sterling, against one of the companies in the same group established in the United Kingdom. Because of the rise in value of the pound sterling against the Dutch guilder, an unrealised exchange rate gain was generated on that claim. In December 2000, National Grid Indus transferred its place of effective management to the United Kingdom, whilst retaining its registered office and its legal personality in the Netherlands, which applies the incorporation theory in company law. Under the Convention for the avoidance of double taxation between the Kingdom of the Netherlands and the United Kingdom and under Netherlands tax legislation, since National Grid Indus no longer derived profits taxable in the Netherlands, unrealised capital gains generated by the exchange rate gain on the date of the transfer of its place of effective management should be subject to a final settlement by the Netherlands tax authorities and be taxed immediately on exit from Netherlands territory. 37. In a reference for a preliminary ruling, the Court had to rule on whether National Grid Indus could rely on freedom of establishment and, if relevant, whether Article 49 TFEU precluded a national tax measure which taxed, with immediate effect, unrealised capital gains relating to an asset of a company transferring its effective management (and its residence for tax purposes) to another Member State. 38. First of all, as regards the applicability of Article 49 TFEU, the Court determined whether, in view of the absence of a uniform definition in European Union law of the companies which may enjoy the right of establishment (15) and the power given to the Member States to define the connecting factor required of a company if it is to be regarded as incorporated under national law and as such capable of enjoying freedom of establishment, (16) a company in a situation like that of National Grid Indus could invoke such a freedom against the application of the national tax legislation. 39. Noting that, in the case in the main proceedings, the transfer by National Grid Indus of its place of effective management to the United Kingdom had not, however, affected its status as a company incorporated under Netherlands law because the Kingdom of the Netherlands applies the incorporation theory, and that the national legislation therefore confines itself to attaching tax consequences, for companies incorporated under national law, to that transfer between Member States, (17) the Court concluded that the transfer had not affected that company’s possibility of relying on Article 49 TFEU. (18) 40. The Court then established the existence of a restriction of freedom of establishment. According to the Court, a company incorporated under Netherlands law wishing to transfer its place of effective management outside Netherlands territory is placed at a disadvantage in terms of cash flow compared to a similar company retaining its place of effective management in the Netherlands, because of the immediacy of the taxation to which the first of these companies is subject, which is liable to deter that company from transferring its place of management to another Member State. (19) 41. Such a difference of treatment cannot be explained by an objective difference of situation. The Court ruled, in general terms, that from the point of view of legislation of a Member State aiming to tax capital gains generated in its territory, the situation of a company incorporated under the law of that Member State which transfers its place of management to another Member State is similar to that of a company also incorporated under the law of the former Member State which keeps its place of management in that Member State, as regards the taxation of the capital gains relating to the assets which were generated in the former Member State before the transfer of the place of management. (20) 42. Lastly, carrying out a detailed examination of the main justification put forward by the governments which submitted observations in the abovementioned National Grid Indus case, namely the allocation of powers of taxation between the Member States, and whilst considering that the Netherlands legislation is appropriate for ensuring such an objective in the public interest (21) and acknowledging that the definitive establishment of the amount of tax at the time when the company transfers its place of effective management to another Member State is proportionate to such an objective, (22) the Court ruled, on the other hand, that immediate recovery of the tax is disproportionate to that objective. 43. In this regard, whereas the Commission and National Grid Indus supported the idea of deferring recovery of the tax debt until the asset was realised (assignment in this case), together with various declarations made by the company concerned, (23) the Member States claimed that only immediate recovery of the tax when the company’s place of effective management was transferred made it possible to safeguard the exercise of their powers of taxation, without an excessive administrative burden. (24) 44. The Court adopted a balanced solution. Aware of the difficulties and the administrative burdens which are entailed, for the company concerned, by the cross-border tracing of assets where the asset situation of a company appears complex, the Court rejected the systematic application of deferred recovery, together with various declarations, as was proposed by the Commission. In the view of the Court, such a solution would not necessarily be any less harmful to freedom of establishment than the immediate recovery of the tax debt corresponding to the capital gain realised. (25) 45. The Court observed that, in other situations, on the other hand, the nature and extent of the company’s assets would make it easy to carry out a cross-border tracing of the individual assets for which a capital gain was ascertained at the time when the company transferred its place of effective management to another Member State. (26) 46. In those circumstances, the Court ruled, in paragraph 73 of the abovementioned judgment in National Grid Indus, that ‘national legislation offering a company transferring its place of effective management to another Member State the choice between, first, immediate payment of the amount of tax, which creates a disadvantage for that company in terms of cash flow but frees it from subsequent administrative burdens, and, secondly, deferred payment of the amount of tax, possibly together with interest in accordance with the applicable national legislation, which necessarily involves an administrative burden for the company in connection with tracing the transferred assets, would constitute a measure which, while being appropriate for ensuring the balanced allocation of powers of taxation between the Member States, would be less harmful to freedom of establishment than the measure at issue in the main proceedings. If a company were to consider that the administrative burden in connection with deferred recovery was excessive, it could opt for immediate payment of the tax’. 47. It added, in paragraph 74 of the judgment, that account should also be taken of the risk of non-recovery of the tax, which increases with the passage of time. According to the Court, that risk may be taken into account by the Member State of exit, in its national legislation applicable to deferred payments of tax debts, by measures such as the provision of a bank guarantee. 48. As regards the first complaint in the present action, the lessons to be drawn from the abovementioned judgment in National Grid Indus relate to three areas of the analysis given by the Court in that judgment, namely with regard to the applicability of freedom of establishment, the restriction of that freedom and the justification for Article 76 A of the CIRC. 49. On the first point, it is evident that there are differences in legal context between the situation in the abovementioned National Grid Indus case and the contested Portuguese legislation. Whilst the Kingdom of the Netherlands applies the incorporation theory and, as is illustrated by the facts of that case, its law recognises without qualification the possibility of transferring the effective management of a Netherlands company without altering its legal personality by keeping its registered office in the Netherlands, the Portuguese Republic, on the other hand, does not apply that theory. 50. None the less, contrary to the suggestions which the German Government appears to make in its response to the written question asked by the Court, Portuguese law does not require the winding-up and the liquidation of the company prior to the transfer of the place of management to another Member State and, consequently, the question of the effect of such a requirement on the applicability of freedom of establishment does not arise in the present case. It is common ground that, in particular, Article 3(4) of the Commercial Companies Code (Código das sociedades comercias) authorises companies governed by Portuguese law to transfer their effective centre of management to another country whilst retaining their legal personality, provided this is permitted by the legislation of that other country. 51. The condition laid down by Article 3(4) of the Commercial Companies Code cannot, in my view, prevent a Portuguese company transferring its effective centre of management to another Member State from relying on freedom of establishment vis-à-vis the Member State of exit, for the following three reasons. 52. First, the retention of the migrant company’s legal personality, provided for by the Portuguese legislation, seeks precisely to permit that company to convert itself into a company governed by the national law of the host State and, therefore, to rely on freedom of establishment vis-à-vis the Member State of exit (or of incorporation). Thus, in paragraph 112 of the judgment in Cartesio, (27) to which the abovementioned judgment in National Grid Indus makes explicit reference in paragraph 30, the Court stated that the power for the Member States not to permit a company governed by its national law to retain that status if the company intends to reorganise itself in another Member State, ‘far from implying that national legislation on the incorporation and winding-up of companies enjoys any form of immunity from the rules of the EC Treaty on freedom of establishment, cannot, in particular, justify the Member State of incorporation ... in preventing that company from converting itself into a company governed by the law of the other Member State, to the extent that it is permitted under that law to do so’. 53. Second, as I have already pointed out in the summary of the arguments of the parties, the Portuguese Government now acknowledges, in its response to the written question asked by the Court, that Article 43 EC is actually applicable to the situation of a company falling under the scope of Article 76 A of the CIRC, since such a company is authorised by Portuguese company law to retain its legal personality. 54. Lastly, the question of a possible restriction of the cross-border incorporation of a new company by the host Member State must be resolved having regard to the legislation of that State – a question which has, moreover, been raised in VALE, currently pending before the Court (28) – and could not, in my view, be invoked by the Member State of origin to prevent a company from relying on freedom of establishment against it. 55. As regards the second point, namely the restrictive character of immediate taxation of unrealised capital gains when the place of management of a Portuguese company is transferred to another Member State, it seems that neither the Portuguese Government nor the governments intervening in support of it any longer dispute, in principle, and in the light of the abovementioned judgment in National Grid Indus, that having regard to the legislation of the Member State of exit, a company incorporated under the law of one Member State which transfers its place of management to another Member State is in an objectively similar position to a company also incorporated under the law of the first Member State which keeps its place of management in that Member State as regards taxation of capital gains relating to assets which were generated in the first Member State before the transfer of the place of management. 56. The Portuguese Government essentially claims, however, that under Portuguese law both these companies are subject to the same tax regime and that, consequently, unlike the situation in the abovementioned National Grid Indus case, a Portuguese company wishing to rely on Article 43 EC does not suffer any disadvantage in terms of cash flow compared to the situation of a company which keeps its place of management in Portugal. 57. I do not find this argument convincing for the simple reason that, as is clear from the summary of its argument in point 28 of this Opinion, the Portuguese Government compares dissimilar situations in order to reject the existence of a difference in treatment. In my view, as far as the contested taxation is concerned, the situation of a company which, whilst transferring its place of management to another Member State, nevertheless carries on its economic activity in full using assets connected to that activity cannot be regarded as objectively similar to the situation of a company which keeps its place of management in Portugal, but whose assets are no longer connected to the taxable economic activity. The taxable event is different in each of these two cases. 58. On the other hand, in the case of a domestic situation where the assets are still assigned to the economic activity of the Portuguese company transferring its place of management within Portugal, the Portuguese Government has not rebutted the Commission’s claim that the capital gains relating to those assets will be taxed only when they have effectively been realised. 59. Nor am I convinced by the Portuguese Government’s argument, essentially developed at the hearing, that the fact that the Portuguese legislation takes into account losses generated in its territory up to the time of the transfer also means that the existence of a restriction of freedom of establishment should be rejected. 60. In this regard, it need only be noted that this was also the case with the Netherlands regime prescribing a ‘final settlement’ when the effective centre of management is transferred to another Member State, the calculation of which is based on the taxable profits of the company concerned in the Netherlands. (29) The fact that the issue of unrealised losses generated in Netherlands territory was not addressed by the Court, for specific reasons relating the circumstances in the abovementioned National Grid Indus case, does not mean that the Portuguese legislation is not liable to impede freedom of establishment. In addition, that legislation is also applicable in circumstances where, as in the abovementioned National Grid Indus case, a Portuguese company wishing to transfer its place of management to another Member State only made unrealised capital gains relating to its assets in Portuguese territory. 61. I therefore conclude that Article 76 A of the CIRC entails a restriction of freedom of establishment which is prohibited, in principle, by Article 43 EC. 62. As regards the third point, which concerns the justification for such a restriction, I would point out that, in its response to the written question asked by the Court, the Portuguese Government concedes, following the abovementioned judgment in National Grid Indus, that if, as I propose, the Court were to find that Article 76 A of the CIRC actually restricts the exercise of freedom of establishment, it would have to introduce into its national law the possibility for companies wishing to transfer their place of management to another Member State to opt either for immediate payment or for deferred recovery of the tax on unrealised capital gains relating to the assets of those companies which were generated in Portuguese territory. 63. Since Article 76 A of the CIRC actually prevents the exercise of such a right of option, the acknowledgement by the Portuguese Government might appear sufficient to uphold the Commission’s complaint relating to the disproportionate character of the requirement laid down in that provision, having regard to the objective in the public interest of safeguarding the balanced allocation of powers of taxation between the Member States. 64. However, before reaching that conclusion, it is necessary to respond to the argument put forward by some of the governments which have intervened to the effect that the findings made by the Court in the abovementioned judgment in National Grid Indus relating to the need to grant such a right of option were circumstantial in view of the atypical nature of the situation in that case and certainly do not require the legislatures of other Member States to incorporate such a possibility into their domestic legal orders. 65. It is true that the abovementioned National Grid Indus case was certainly unusual in so far as the company concerned held a single financial asset. In general, the cross-border tracing of such an individual asset of the company, which involves the option of deferred recovery of the tax debt appertaining to a capital gain generated before the transfer of the place of management and ascertained at the time of the transfer, is therefore easy. 66. Nevertheless, in its present wording, Article 76 A of the CIRC does not permit, even in a situation identical or similar to that in the abovementioned judgment in National Grid Indus, the option referred to in paragraph 73 of that judgment and reproduced in point 46 of this Opinion, to be exercised. At present, a Portuguese company in a situation identical or similar to that in National Grid Indus would therefore be forced to mount a legal challenge to the application of immediate taxation of unrealised capital gains relating to one or more financial assets. 67. Consequently, contrary to the suggestions made by some of the governments which have intervened, I cannot see how the Portuguese Republic could maintain in force Article 76 A of the CIRC. 68. This does not mean that, in choosing measures less harmful to freedom of establishment than immediate payment of the contested tax, the Portuguese Republic is reduced only to introducing the possibility available to the company concerned to opt for deferred payment of the tax debt ascertained when the place of management is transferred. In particular, it is possible, as the German Government suggested in response to the written question asked by the Court, that also offering companies the opportunity to stagger payments of the tax debt, ascertained when the place of management is transferred, for example on annual maturities or as capital gains are realised, may constitute a measure which is appropriate and proportionate to the objective of safeguarding the balanced allocation of powers of taxation between the Member States. 69. Nevertheless, aside from the fact that no such proposal was put forward by the Commission in its action and that is it for the Member State concerned to choose alternatives to a restrictive regulation of freedom of movement as laid down in the Treaty, it would seem sufficient, in order to uphold the Commission’s first complaint, to observe that Article 76 A of the CIRC does not offer any alternative to the requirement of immediate payment of tax on capital gains relating to one or more assets of a company transferring its place of management to another Member State, including in situations where the nature and extent of the company’s assets would make it easy to carry out a cross-border tracing of the individual assets for which a capital gain was ascertained at the time when the company transferred its registered office and effective centre of management to another Member State. (30) 70. In the light of the foregoing, it would also not be strictly necessary for the Court to enter the fairly lively debate which took place between the parties at the hearing regarding two observations made in the abovementioned judgment in National Grid Indus in connection with the option of deferred payment of tax. 71. Nevertheless, should the Court decide to rule on these aspects, I wish to make the following observations. 72. I would point out that, in paragraphs 73 and 74 of the judgment in National Grid Indus, the Court accepted that deferred payment may be made ‘possibly together with interest in accordance with the applicable national legislation’ and acknowledged that ‘the risk of non-recovery of the tax [entailed by its deferred payment], which increases with the passage of time … may be taken into account by the Member State [of exit], in its national legislation applicable to deferred payments of tax debts, by measures such as the provision of a bank guarantee’. 73. Whilst the Portuguese Government and most of the governments which have intervened essentially state that these requirements should hold in all cases where the deferred payment option is applied, the Commission considers that charging interest for late payment is intrinsically discriminatory since resident taxpayers are asked to pay tax only subsequently, without interest and, with regard to the provision of a bank guarantee, shares the view taken by the Danish Government that such a guarantee can be demanded only where there is a genuine and proven risk of non-recovery of tax. 74. With regard to interest – and aside from the semantic debate which took place, in particular, between the German Government and the Commission at the hearing; the former, mentioning deferral or recovery interest, contested the characterisation made by the latter – I note that a number of Member States apply interest, sometimes classified as ‘interest for late payment’, on the amount of the tax claims of their taxpayers, including where deferred payment of the tax debt is authorised. (31) Although I am not certain, this is, I think, the situation to which the clarification made by the Court in paragraph 73 of the abovementioned judgment in National Grid Indus relates. 75. In my view, the Commission’s criticism regarding the discriminatory character of such a requirement cannot be accepted. 76. If, in a domestic situation where a place of management is transferred, such interest is not demanded, this is simply because the amount of the tax debt will be ascertained and therefore payable only upon the effective realisation of the capital gains. It is then that the tax debt will have to be paid, as a rule in the absence of the grant of a deferred payment. (32) By contrast, because, in a cross-border situation, the Member States are authorised, as is confirmed in the abovementioned judgment in National Grid Indus, to fix the amount of the tax debt payable in connection with unrealised capital gains relating to assets of a company transferring its place of management to another Member State at the time of that transfer, but the actual payment is deferred, the interest payable on that amount may be treated in the same way as interest payable on a loan granted to that company. 77. Consequently, and in accordance with the principle of equivalence, if, in its national legislation generally applicable to the recovery of tax claims, a Member State provides that the option of deferred payment comes together with interest, there is no objective reason to exclude from it the situation of a company transferring its place of management to a Member State, whose tax debt in the Member State of exit was ascertained at the time of that transfer. 78. The provision of a bank guarantee seems to be an issue which is more difficult to resolve. Whilst, in paragraph 74 of the abovementioned judgment in National Grid Indus, the Court appears to envisage it as just one of several measures, the systematic application of such a requirement with a view to ensuring the recovery of tax in the context of its deferred payment could nevertheless have an equally restrictive effect as its immediate payment at the time when the place of management is transferred to another Member State, since it is likely to deprive the taxpayer of the enjoyment of the assets provided as a guarantee. 79. Moreover, I would point out that, in Lasteyrie du Saillant (33) and N, (34) the Court ruled that the provision of guarantees which was required of natural persons who transfer their residence for tax purposes to another Member State and who wish to benefit from the deferred payment of the tax on unrealised capital gains relating to their securities was disproportionate to the objectives in the public interest pursued by the Member States. (35) In N, the Court stated that there were methods less restrictive of fundamental freedoms, such as the mutual assistance mechanisms introduced at EU level, in particular for the recovery of tax claims. (36) 80. Whilst, in paragraph 74 of the abovementioned judgment in National Grid Indus, the Court did not mention these mechanisms, this silence cannot, in my view, mean that it intended to give the Member States carte blanche, allowing them to introduce a measure (deferred payment together with a bank guarantee) the effects of which may be just as restrictive as the measure (immediate payment) which it considered, in the preceding paragraphs of that judgment, to entail a disproportionate obstacle to freedom of establishment. 81. Consequently, in order to preserve both the internal coherence of the Court’s reasoning in the abovementioned judgment in National Grid Indus and its external coherence with the abovementioned rulings in Lasteyrie du Saillant and N, a strict interpretation must therefore be given, in my view, to the requirement of the provision of a bank guarantee, possibly together with the option of the deferred recovery of the tax debt. 82. I essentially share the view taken by the Commission and the Danish Government to the effect that such a guarantee can be required only if there is a genuine and serious risk of non-recovery of the tax claim. Furthermore, contrary to the claims made by the French Government in its response to the written question asked by the Court and at the hearing, I consider that the amount of the required bank guarantee cannot correspond to the amount of the tax claim the payment of which is deferred, otherwise a measure which is as restrictive as immediate payment of the tax when the place of management is transferred will be reintroduced. That guarantee must nevertheless be sufficient having regard to the circumstances of each specific case. 83. In the light of these considerations, I propose, as I have already stated, that the first complaint set out by the Commission in its action be upheld. 2. Immediate taxation of unrealised capital gains relating to assets assigned to a Portuguese permanent establishment of a non-resident company in the case of the cessation of the permanent establishment’s activity or where those assets are transferred out of Portuguese territory (Article 76 B of the CIRC) a) Immediate taxation of unrealised capital gains relating to assets assigned to a Portuguese permanent establishment of a non-resident company in the case of the cessation of the permanent establishment’s activity (Article 76 B(a) of the CIRC) i) Summary of the arguments of the parties 84. The Commission considers that the considerations developed regarding the restrictive and disproportionate character of the provisions of Article 76 A of the CIRC are also valid for the situation covered by Article 76 B(a) of the CIRC. There is therefore no justification for subjecting to immediate taxation, without exception, unrealised capital gains relating to assets assigned to a Portuguese permanent establishment of a non-resident company in the case of the cessation of the permanent establishment’s activity. 85. The Portuguese Government also refers to the arguments set out in its pleadings in relation to Article 76 A of the CIRC. In its response to the written question asked by the Court, it adds that, even though the abovementioned judgment in National Grid Indus does not directly cover the situation referred to in Article 76 B(a) of the CIRC, paragraph 57 of that judgment is pertinent. Should the Court recognise that there is a restriction of freedom of establishment, if it cannot demand the immediate recovery of the tax, the Portuguese Republic could at least legitimately prescribe deferred payment, possibly together with interest and, taking into account the risk of non-recovery, against the provision of a bank guarantee. 86. The governments which have intervened take different positions as to the pertinence of the abovementioned judgment in National Grid Indus to the situation referred to in Article 76 B(a) of the CIRC. Whereas the Spanish and Netherlands Governments consider the judgment to be fully applicable to that situation, with the latter adding that the taxpayer must be given the choice between immediate payment and deferred payment of tax, the German and Swedish Governments take the view that the situation is not affected by the abovementioned judgment, since immediate recovery of tax is the only appropriate measure in the case of the cessation of the activity of a permanent establishment in the territory of a Member State. ii) Analysis 87. The Court has repeatedly ruled that freedom of establishment entails for companies or firms formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Community, the right to exercise their activity in other Member States through a subsidiary, branch or agency. (37) 88. It is also settled case-law that restrictive effects on freedom of establishment may arise specifically where, on account of a tax law, a company may be deterred from setting up subsidiary bodies such as permanent establishments in other Member States and from carrying on its activities through such bodies. (38) 89. It should be noted that this finding was made in respect of the tax legislation of the Member State of origin of the company and not in relation to the legislation of the host Member State of its permanent establishment. 90. However, in the present case, unlike the situation, examined above, of the transfer of the place of management of a Portuguese company to another Member State, in respect of which the Portuguese Republic exercises its fiscal sovereignty as the Member State of origin, the taxation of unrealised capital gains upon the cessation of the activity of a permanent establishment in Portugal of a non-resident company, referred to in Article 76 B(a) of the CIRC, comes under the exercise of that Member State’s sovereignty as the host country of that permanent establishment. 91. In accordance with the wording of Article 43 EC, the obligation on the host Member State is to ensure that foreign nationals and companies are treated in the same way as nationals of that State. (39) 92. Consequently, it is necessary to examine the domestic situation comparable to that of a non-resident company whose permanent establishment ceases its activities in Portuguese territory, in respect of which a discriminatory difference in treatment might possibly be established. 93. The parties to the present case have discussed this question very little. 94. Nevertheless, it seems that the situation of a permanent establishment referred to in Article 76 B(a) of the CIRC is objectively comparable to that of a permanent establishment, situated in Portugal, of a company established in that same Member State. 95. I am certainly aware that, as the German Government stressed in disputing that these situations were comparable, whilst in a purely domestic situation an establishment and the principal company form an entity from a fiscal point of view, a permanent establishment connected with a non-resident company is regarded as an autonomous fiscal entity in accordance with international legal practice as reflected, in particular, in Articles 5 and 7 of the Model Tax Convention on Income and on Capital produced by the Organisation for Economic Cooperation and Development (OECD). (40) Thus, on the basis of the allocation of powers set out in Article 7 of the Model Tax Convention, the Portuguese Government also acknowledges that in principle the Portuguese Republic exercises its fiscal sovereignty only in respect of profits attributable to a permanent establishment of a non-resident company from another Member State. EU law does not preclude such an allocation of fiscal sovereignty between the Member States or, to that end, the classification of a permanent establishment as an autonomous fiscal entity, (41) that is to say similar to an enterprise dealing wholly independently with the enterprise from which that establishment emanates. 96. However, I do not think that this means that the situation of those two permanent establishments, one in a cross-border context, the other in a purely domestic contest, cannot be objectively comparable just because the Portuguese Republic loses its fiscal sovereignty only in the former case once the assets are transferred to another Member State. 97. If that were the case, this reasoning should also have been followed by the Court in the abovementioned judgment in National Grid Indus in relation to the situation of a company of a Member State transferring its effective centre of management to another Member State, in respect of which, following the transfer, the Member State of origin loses its fiscal sovereignty, compared with the situation of a company transferring its place of management within the territory of the former Member State, in respect of which that Member State retains fiscal sovereignty. However, as has already been observed, the Court considered these two situations to be objectively comparable. 98. Furthermore, in the abovementioned judgment in Lidl Belgium, the Court did not consider that the provisions of the OECD Model Tax Convention constituted an obstacle to the comparison of the situation of a permanent establishment of a company established in the same Member State with the situation of a permanent establishment of that same company situated in another Member State with a view to identifying a restriction of freedom of establishment. (42) Moreover, it is not disputed that classifying a permanent establishment of a non-resident company as an autonomous fiscal entity constitutes a fiction established for the simple purpose of facilitating the exercise of the powers of taxation allocated between the Member States concerned. (43) 99. Consequently, in the light of the standard of comparison adopted, a restriction of freedom of establishment must be established since, unlike the cross-border situation, the cessation of the activity of the national permanent establishment of a Portuguese company does not give rise to immediate taxation of unrealised capital gains relating to assets transferred to that company. 100. The Portuguese Government still takes the view that the cessation of a permanent establishment’s activity and the transfer of its assets to another Member State are similar, in a purely domestic situation, to the disconnection of the assets concerned from an economic activity. In so far as unrealised capital gains are taxed in both situations, there is no difference in treatment. 101. I am not convinced by this argument for the same reasons as set out above in relation to the case of a company transferring its place of management to another Member State: the assets which may be attributed to a permanent establishment which leaves Portuguese territory continue to be connected with that permanent establishment’s economic activity, even though that activity is carried on in another Member State. It does not therefore seem possible, for the purposes of the application of freedom of establishment, as protected by the Treaty, to regard as comparable the cessation of all economic activity and the cessation of an economic activity carried on in the territory of a specific Member State. 102. Contrary to the argument put forward by the Portuguese Government at the hearing, I do not think that the statement made in paragraph 57 of the abovementioned judgment in National Grid Indus can refute this conclusion. Whilst it is true that the Court noted in that paragraph that ‘the assets of a company are assigned directly to economic activities that are intended to produce a profit’, this finding was not made in the context of the restrictive character of the Netherlands legislation, but as part of the analysis of its proportionality in so far as it refused to take into account decreases in value that occur after the transfer of a company’s place of effective management to another Member State. It cannot therefore be inferred from paragraph 57 of the judgment in National Grid Indus that, on the one hand, the disconnection of the assets of a permanent establishment from any economic activity in a Member State and, on the other, the transfer of such assets to another Member State upon the cessation of that permanent establishment’s activity in the former Member State are comparable situations. 103. For the rest, as was claimed by the Commission and the Netherlands Government in its response to the written question asked by the Court, similar considerations to those outlined in relation to companies transferring their place of management to another Member State can be made with respect to immediate taxation of unrealised capital gains generated by assets connected with a permanent establishment upon the cessation of that establishment’s activity in Portuguese territory. 104. In particular, with regard to the proportionality of the national measure, it should be pointed out that, irrespective of the nature and the extent of the assets assigned to the permanent establishment, the cessation of its activity in Portugal gives rise, in all cases, to immediate payment of tax on unrealised capital gains relating to assets linked to that establishment. 105. This finding is sufficient, in my view, to uphold the Commission’s second complaint relating to Article 76 B(a) of the CIRC. b) Immediate taxation of unrealised capital gains relating to assets assigned to a Portuguese permanent establishment of a non-resident company where those assets are transferred out of Portuguese territory (Article 76 B(b) of the CIRC) i) Summary of the arguments of the parties 106. In the view of the Commission, this situation does not differ fundamentally from the others already examined. In so far as the non-resident company keeps a permanent establishment in Portugal and the assets are retained at the place of management or in another permanent establishment situated within the European Union, there is no reason to effect immediate recovery of the tax. The Portuguese Republic’s right to tax capital gains made in its territory in connection with assets is adequately protected by a measure providing for the calculation of the amount of tax when the assets are transferred, the tax being paid upon the effective realisation of the capital gains. 107. The Portuguese Government reiterates the arguments which it put forward in relation to the situations already examined, stating that the abovementioned judgment in National Grid Indus does not cover the case of taxation of unrealised capital gains at the time when assets are transferred between a permanent establishment situated in Portugal and the non-resident principal company or another permanent establishment of the non-resident company situated in another Member State. 108. The governments which have intervened essentially share the Portuguese Government’s position. 109. The German and Swedish Governments observe, above all, that the situation of the transfer of assets between a Portuguese permanent establishment and the related company, which is established in another Member State, is not comparable with that of an equivalent transfer between a Portuguese permanent establishment and its Portuguese company. 110. In any event, in the view of the German, Netherlands and Swedish Governments in particular, immediate taxation at the time of the transfer is absolutely necessary in order to safeguard the allocation of powers of taxation and, in the view of the Swedish Government, to prevent the risk of tax avoidance. The Court’s case-law with regard to cross-border transfers of profits or losses is applicable. The Netherlands and Swedish Governments also stress that, unlike the situation in National Grid Indus, which concerned a single asset at the time of the transfer of the company’s effective centre of management, the transfer of assets of a permanent establishment to another Member State is an ongoing process which is generally very difficult to follow, not only because of the large number of assets involved, but also on account of the diverse nature of the assets, some of which, like capital equipment, are written off, while others, like oil, are incorporated into goods which themselves undergo transformations. Consequently, the deferred recovery of tax would sometimes be impossible or, at least, very difficult to introduce. ii) Analysis 111. With respect to the restrictive character of the provisions of Article 76 B(b) of the CIRC and as regards the argument put forward by the German and Swedish Governments that it is not possible to compare the transfer of assets, on the one hand, between a permanent establishment situated in Portugal and its non-resident company or another permanent establishment emanating from that company situated in another Member State and, on the other, between a permanent establishment and its related company, both situated in Portugal, I wish to refer to the observations made in this regard in points 94 to 99 of this Opinion. 112. I would add, so far as is relevant and even though the Court is, at least implicitly, reticent to compare such situations, (44) that if, as has sometimes been advocated in fiscalist theory, (45) we were to compare two cross-border situations, namely that of a permanent establishment transferring its assets to its related company or another permanent establishment situated in another Member State and that of a Portuguese company transferring its assets to a permanent establishment situated in another Member State, the Portuguese Government has clearly stated during the present proceedings that the transfer of assets in the latter scenario did not give rise to payment of tax on unrealised capital gains relating to the assets concerned, which were generated in Portuguese territory. 113. As regards the justification for the restriction, I would point out that the Commission does not raise any criticism of the fact that Article 76 B(b) of the CIRC is appropriate for ensuring the pursuit of the objective in the public interest highlighted by the Portuguese Government and most of the governments which have intervened, namely safeguarding the allocation of powers of taxation between the Member States, without there being a need to take that objective together with the objective of preventing tax avoidance. (46) It also acknowledges, especially following the abovementioned judgment in National Grid Indus, that the definitive establishment of the amount of tax can be made when the assets are transferred to another Member State. 114. I think that this may be noted by the Court. 115. By contrast, just as in the situations examined above, the Commission disputes the proportionate character of the restriction stemming from Article 76 B(b) of the CIRC, taking the view that deferred recovery of tax would be a more appropriate measure. 116. In this regard, the Portuguese Government and the governments which have intervened have essentially set out the difficulties and administrative burdens suffered by the establishments concerned, but also by the Member States’ tax authorities in calculating the amount of tax due and in tracing the transferred assets, in view of their nature, their diversity and their number, if deferred recovery were introduced. 117. Like the Court in the abovementioned judgment in National Grid Indus, (47) I am not insensitive to these considerations. In some cases, which may prove to be the majority, moreover, they may justify the application of immediate taxation. 118. However, they do not constitute an obstacle to the acceptance of the Commission’s third complaint any more than in the other scenarios examined above. 119. Article 76 B(b) of the CIRC is generally applicable to the transfer of one or more assets, irrespective of the nature and the extent of the assets assigned to the permanent establishment of a company established in another Member State. Thus, even unrealised capital gains relating to a single financial asset of that permanent establishment transferred to its related company or to another permanent establishment of that company, situated in another Member State, would also be taxed immediately at the time of transfer. 120. In my view, this finding is sufficient also to grant the application on this point. 121. In addition, I do not think that, in the situation referred to in Article 76 B(b) of the CIRC, and unlike the case of the transfer of a company’s place of management or the cessation of a permanent establishment’s activities, the option of deferred recovery can be made subject to the provision of a bank guarantee, since the Member State in which the permanent establishment continues to be situated still retains fiscal sovereignty over it, even after the transfer of the assets. Consequently, the presence of that permanent establishment in the territory of the Member State ‘of exit’ can, in principle, sufficiently guarantee the recovery of the tax claim. 122. In the light of all these considerations, I suggest that the Court grant the application made by the Commission in part and dismiss it as to the remainder. III – Costs 123. Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. As the Commission has made such an application, I suggest that the Portuguese Republic be ordered to pay the costs. Pursuant to Article 69(4) of the Rules of Procedure, I propose that the Member States which have intervened in the proceedings should bear their own costs. IV – Conclusion 124. In the light of the foregoing considerations, I propose that the Court: – Declare that, by adopting and maintaining in force the legislative provisions contained in Articles 76 A and 76 B(a) and (b) of the Corporation Tax Code (Código do Imposto sobre o Rendimento das Pessoas Colectivas), which are applicable respectively in the case of the transfer by a Portuguese company of its registered office and effective centre of management to another Member State, in the case of the cessation of activities of a permanent establishment in Portugal, and in the case of the transfer of the assets of such a permanent establishment from Portugal to another Member State and which provide, in all cases, for immediate taxation of unrealised capital gains relating to the assets of those entities when they leave Portuguese territory, irrespective of the nature and the extent of the assets of the companies and the permanent establishments concerned, the Portuguese Republic has failed to fulfil its obligations under Article 43 EC; – Dismiss the remainder of the application; – Order the Portuguese Republic to pay the costs incurred by the European Commission; – Make an appropriate order as to the costs incurred by the Kingdom of Denmark, the Federal Republic of Germany, the Kingdom of Spain, the French Republic, the Kingdom of the Netherlands, the Republic of Finland, the Kingdom of Sweden and the United Kingdom of Great Britain and Northern Ireland. 1 – Original language: French. 2 – Since the period for complying with the reasoned opinion issued by the Commission expired in February 2009, reference must be made to the provisions of the EC Treaty. 3 – Agreement of 2 May 1992 (OJ 1994 L 1, p. 3). 4 – Namely the Kingdom of Denmark, the Federal Republic of Germany, the Kingdom of Spain, the French Republic, the Kingdom of the Netherlands, the Republic of Finland, the Kingdom of Sweden, and the United Kingdom of Great Britain and Northern Ireland. 5 – See the proceedings pending before the Court in Case C‑64/11 Commission v Spain; Case C‑261/11 Commission v Denmark; and Case C‑301/11 Commission v Netherlands. 6 – C‑371/10 [2011] ECR I-12273. 7 – Case C‑371/10 National Grid Indus, paragraph 86 and second indent of point 2 of the operative part. 8 – See, inter alia, Case C‑362/90 Commission v Italy [1992] ECR I-2353, paragraph 8; Case C‑195/04 Commission v Finland [2007] ECR I-3351, paragraph 21; Case C‑487/08 Commission v Spain [2010] ECR I-4843, paragraph 70; and Case C‑53/08 Commission v Austria [2011] ECR I-4309, paragraph 128. 9 – See, in particular, Case C‑365/97 Commission v Italy [1999] ECR I-7773, paragraph 35; Case C‑392/99 Commission v Portugal [2003] ECR I-3373, paragraph 133; and Case C‑221/03 Commission v Belgium [2005] ECR I-8307, paragraph 37. 10 – See Case C‑191/95 Commission v Germany [1998] ECR I-5449, paragraph 55; Case C‑422/05 Commission v Belgium [2007] ECR I-4749, paragraph 25; Case C‑186/06 Commission v Spain [2007] ECR I-12093, paragraph 15; Case C‑457/07 Commission v Portugal [2009] ECR I-8091, paragraph 55; and Case C‑535/07 Commission v Austria [2010] ECR I-9483, paragraph 41. 11 – Idem. 12 – See Case 51/83 Commission v Italy [1984] ECR 2793, paragraphs 6 and 7; Case C‑186/06 Commission v Spain, cited above, paragraph 15; and Case C‑535/07 Commission v Austria, cited above, paragraph 41. 13 – See paragraph 2 of the response of 6 April 2009, annexed to the application. 14 – See Case C‑390/07 Commission v United Kingdom, not published in the ECR, paragraph 339, and Case C‑487/08 Commission v Spain, cited above, paragraph 71. 15 – Paragraph 26 of the judgment. 16 – Paragraph 27 of the judgment. 17 – Paragraphs 28 and 31 of the judgment. 18 – Paragraph 32 of the judgment. 19 – See paragraph 37 of the judgment. 20 – Paragraph 38 of the judgment. 21 – Paragraph 48 of the judgment. 22 – See, inter alia, paragraphs 56 and 64 of the judgment. 23 – See paragraphs 65 and 66 of the judgment. 24 – Paragraph 67 of the judgment. 25 – See paragraphs 70 and 71 of the judgment. 26 – Paragraph 72 of the judgment. 27 – Case C‑210/06 Cartesio [2008] ECR I-9641. 28 – Case C‑378/10. In this regard, I would state that I share the view taken by Advocate General Jääskinen, set out in points 70 to 73 of his Opinion delivered on 15 December 2011 in that case, to the effect that, in the light of the principle of non-discrimination as applied by the Court in its case-law, the host Member State could not arbitrarily prohibit or prevent the cross-border incorporation of a new company for the simple reason that its national company law has not provided for such a possibility. 29 – See, inter alia, paragraph 22 of the observations submitted by the Netherlands Government in National Grid Indus. 30 – See Case C‑371/10 National Grid Indus, cited above, paragraph 72. 31 – See, in particular, Article 1727( IV) of the French Code général des impôts; Article 6 of the Règlement grand-ducal luxembourgeois du 28 décembre 1968 portant exécution des Articles 155 et 178 de la loi concernant l’impôt sur le revenu. See also Article 414 of the Belgian Code de l’impôt sur le revenu, applicable to the deferred payment of tax, and in Germany, Article 234 of the Abgabenordnung of 1 October 2002. 32 – If the Member State nevertheless gives the company concerned the possibility to defer payment of tax and if its national legislation on the recovery of tax claims provides for the payment of interest, it must be applied. 33 – Case C‑9/02 [2004] ECR I-2409, paragraphs 47, 56 and 57. 34 – Case C‑470/04 [2006] ECR I-7409, paragraph 51. 35 – In the context of Lasteyrie du Saillant, the guarantees required by the French tax authorities could take the form of a cash payment to the Treasury, an acknowledgement of indebtedness in favour of the Treasury, the lodging of a deposit, securities, goods deposited at State-approved warehouses and subject to a warrant endorsed in favour of the Treasury, mortgage charges, and pledging of business assets. In N, the guarantee provided consisted in the taxpayer depositing, by way of security, his holdings in one of his companies. 36 – Case C‑470/04 N, cited above, paragraphs 51 to 53. 37 – See, inter alia, Case C‑307/97 Saint-Gobain ZN [1999] ECR I-6161, paragraph 35; Case C‑141/99 AMID [2000] ECR I-11619, paragraph 20; Case C‑414/06 Lidl Belgium [2008] ECR I‑3601, paragraph 18; Case C‑157/07 Krankenheim Ruhesitz am Wannsee-Seniorenheimstatt [2008] ECR I-8061, paragraph 28; and Case C‑337/08 X Holding [2010] ECR I-1215, paragraph 17. 38 – See Case C‑293/06 Deutsche Shell [2008] ECR I-1129, paragraph 29. See also Case C‑414/06 Lidl Belgium, cited above, paragraphs 19, 20 and 25. 39 – See, inter alia, Case C‑414/06 Lidl Belgium, cited above, paragraph 19. 40 – Under Article 5(1) of the Model Tax Convention (in its version of July 2008 applicable on the date specified in the reasoned opinion), ‘permanent establishment’ means a fixed place of business through which the business of an enterprise is wholly or partly carried on. Under paragraph 2 of that article, the term ‘permanent establishment’ includes especially a branch, an office, and a factory. Article 7(1) of the Model Tax Convention provides that if an enterprise of a Contracting State carries on business in the other Contracting State through a permanent establishment, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable to that permanent establishment. Paragraph 2 states that there shall be attributed to that permanent establishment the profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 41 – See Case C‑414/06 Lidl Belgium, cited above, paragraph 22. 42 – Judgment cited above, paragraphs 23 to 25. 43 – Such classification does not hold, however, with regard to the value-added tax applicable to transactions carried out between a company and its permanent establishment; see Case C‑210/04 FCE Bank [2006] ECR I-2803, paragraphs 35 to 41. 44 – See, in this regard, the judgment in Case C‑298/05 Columbus Container Services [2007] ECR I‑10451, in comparison with my Opinion in that case (paragraphs 109 to 122). 45 – See, in particular, Tenore M., The Transfer of Assets From a Permanent Establishment to its General Enterprise in the Light of European Tax Law, Intertax, 2006, 8/9, p. 389. 46 – As regards this latter objective, put forward by the Swedish Government, it need only be noted that that is a possible autonomous justification only if the specific objective of the restriction is to prevent conduct involving the creation of wholly artificial arrangements which do not reflect economic reality, with a view to escaping the tax normally due on the profits generated by activities carried out on national territory, which has not been proven: see, inter alia, Case C‑303/07 Aberdeen Property Fininvest Alpha [2009] ECR I-5145, paragraph 64; and Case C‑311/08 SGI [2010] ECR I-487, paragraph 65. 47 – See paragraph 70.