Case C-196/04: Judgment of the Court (Grand Chamber) of 12 September 2006 (reference for a preliminary ruling from the Special Commissioners, London — United Kingdom) — Cadbury Schweppes plc, Cadbury Schweppes Overseas Ltd v Commissioners of Inland Revenue (Freedom of establishment — Law on controlled foreign companies — Inclusion of the profits of controlled foreign companies in the tax base of the parent company)
Date: 2006-11-18
Institutions: Court of Justice
Subjects: corporation tax, interpretation of the law, profit, subsidiary, tax law, tax system

18.11.2006

EN

Official Journal of the European Union

C 281/5

3. In the framework of

the common system of value added tax,
national tax authorities are obliged to respect the principle of
protection of legitimate expectations. It falls to the referring court
to decide whether, in the circumstances of the main proceedings,
the taxable person could reasonably have believed that the decision
in question had been taken by a competent authority.

(1) OJ C 168, 26. 6. 2004.
OJ C 201, 07. 8. 2004.

Member State of profits made by a controlled foreign company in
another Member State, where those profits are subject in that State to
a lower level of taxation than that applicable in the first State, unless
such inclusion relates only to wholly artificial arrangements intended
to escape the national tax normally payable. Accordingly, such a tax
measure must not be applied where it is proven, on the basis of objec-
tive factors which are ascertainable by third parties, that despite the
existence of tax motives that controlled company is actually established
in the host Member State and carries on genuine economic activities
there.

(1) OJ C 168, 26. 6. 2004.

Judgment of the Court (Grand Chamber) of 12 September
2006 (reference for a preliminary ruling from the Special
Commissioners, London — United Kingdom) — Cadbury
Schweppes plc, Cadbury Schweppes Overseas Ltd v
Commissioners of Inland Revenue

(Case C-196/04) (1)

(Freedom of establishment — Law on controlled foreign
companies — Inclusion of the profits of controlled foreign
companies in the tax base of the parent company)

(2006/C 281/08)

Language of the case: English

Referring court

Special Commissioners, London

Parties to the main proceedings

Applicants: Cadbury Schweppes plc, Cadbury Schweppes Over-
seas Ltd

Defendant: Commissioners of Inland Revenue

Re:

Preliminary ruling — Special Commissioners, London —
National legislation attributing to a parent company the profits
of a subsidiary resident in another Member State which has a
lower rate of taxation — Obligation of the parent company to
pay a charge in order to off set the difference between the two
rates of taxation — Whether compatible with Articles 43 EC,
49 EC and 56 EC

Operative part of the judgment

Articles 43 EC and 48 EC must be interpreted as precluding the
inclusion in the tax base of a resident company established in a

Judgment of the Court (Grand Chamber) of 12 September
2006 (reference for a preliminary ruling from the Raad
van State (Netherlands)) — M.G. Eman, O.B. Sevinger v
College van burgemeester en wethouders van Den Haag

(Case C-300/04) (1)

(European Parliament — Elections — Right
to vote —
Requirements of residence in the Netherlands for Netherlands
citizens of Aruba — Citizenship of the Union)

(2006/C 281/09)

Language of the case: Dutch

Referring court

Raad van State (Netherlands)

Parties to the main proceedings

Applicants: M.G. Eman, O.B. Sevinger

Defendant: College van burgemeester en wethouders van Den
Haag

Re:

Reference for a preliminary ruling — Netherlands Raad van
State — Interpretation of Articles 17 EC and 19 EC,
in
conjunction with Articles 189 EC, 190 EC and 299 EC —
Application of the provisions on citizenship of the Union to
residents of the overseas countries and territories — Right of
residents of the Netherlands Antilles and Aruba to vote in elec-
tions to the European Parliament subject to a requirement of
ten years' residence in the Netherlands