Order of the Court (Fifth Chamber) of 18 June 2012 — Amorim Energia BV v Ministério das Finanças e da Administração Pública

(Case C-38/11)

The first subparagraph of Article 104(3) of the Rules of Procedure — Articles 49 TFEU and 54 TFEU — Articles 63 TFEU and 65 TFEU — Directive 90/435/EEC — Article 3(2) — Tax legislation — Corporation tax — Taxation of dividends — Withholding tax — Exemption — Minimum holding in the company distributing dividends — Conditions — Minimum period of uninterrupted share ownership –Conditions — Resident and non-resident recipient companies — Different treatment

1. Free movement of capital and liberalisation of payments — Provisions of the Treaty — Scope — National legislation affecting holdings in the capital of an undertaking acquired for the sole purpose of making a financial investment, with no intention of influencing the management and supervision of the undertaking — Included — Non-applicability of the provisions governing freedom of establishment (Art. 63 TFEU) (see paras 37-39)

2. Free movement of capital and liberalisation of payments — Restrictions — Tax legislation or Fiscal legislation — Corporation tax — Taxation of dividends distributed by a resident company to a non-resident recipient company having a holding greater than 10% but less than 20% of the distributing company’s capital — Exemption of dividends distributed to resident share-holding companies with the same type of holdings — Not permissible — Limits — Effects of such a restriction of the free movement of capital neutralised by a double taxation convention — Determination by the national court (Arts 63 TFEU and 65 TFEU) (see paras 52-69, operative part 1)

3. Freedom of movement for persons — Freedom of establishment — Tax legislation — Corporation tax — Taxation of dividends — Tax withheld at source on dividends distributed by a resident company to a company resident in another Member State reimbursed on condition that the latter company has held a holding of more than 20% for two years continuously — Delay in doing away with the double taxation of dividends — Unlawful — Limits — Effects of such a restriction of freedom of establishment neutralised by a double taxation convention — Determination by the national court (Arts 49 TFEU and 54 TFEU) (see paras 70-84, operative part 2)

Re:

Reference for a preliminary ruling — Supremo Tribunal Administrativo — Interpretation of Articles 63 TFEU and 65 TFEU — National legislation subjecting dividends distributed to non-resident companies to tax rules less favourable than those applied to dividends distributed to resident companies — Non-resident companies required to have held shares for a longer minimum period and to possess a larger minimum holding.

Operative part:

1. Articles 63 TFEU and 65 TFEU preclude the legislation of a Member State, such as that at issue in the main proceedings, which does not permit a company resident in another Member State with a holding of more than 10% but less than 20% in a company resident in Portugal to obtain exemption from the tax withheld at source on dividends distributed by the company resident in Portugal and therefore subjects those dividends to economic double taxation, whereas, if the dividends are distributed to shareholder companies resident in Portugal with the same kind of holdings, such economic double taxation is avoided. Where a Member State relies on a convention for the avoidance of double taxation concluded with another Member State, it is for the national court to establish whether account should be taken, in the main proceedings, of that convention and, if so, to determine whether it enables the effects of the restriction of the free movement of capital to be neutralised.