Case C-414/04: Judgment of the Court (Grand Chamber) of 28 November 2006 — European Parliament v Commission of the European Communities (Regulation (EC) No 1228/2003 — Conditions for access to the network for cross-border exchanges in electricity — Regulation (EC) No 1223/2004 — Temporary derogations in favour of Slovenia — Legal basis)
Date: 2006-12-30
Institutions: Court of Justice
Subjects: Council of the European Union, European Parliament, Slovenia, action for annulment (EU), approximation of laws, derogation from EU law, electrical energy, single market

C 331/4

EN

Official Journal of the European Union

30.12.2006

Operative part of the judgment

and of the Council as regards the application of certain provi-
sions to Estonia (OJ 2004 L 236, p. 10) — Legal basis

1. Articles 43 EC and 56 EC do not prevent a Member State, on a
distribution of dividends by a company resident in that State, from
granting companies receiving those dividends which are also resident
in that State a tax credit equal to the fraction of the corporation
tax paid on the distributed profits by the company making the
distribution, when it does not grant such a tax credit to companies
receiving such dividends which are resident
in another Member
State and are not subject to tax on dividends in the first State;

2. Articles 43 EC and 56 EC do not preclude a situation in which a
to a tax credit
Member State does not extend the entitlement
provided for
in a double taxation convention concluded with
another Member State for companies resident in the second State
which receive dividends from a company resident in the first State
to companies resident in a third Member State with which it has
concluded a double taxation convention which does not provide for
such an entitlement for companies resident in that third State.

(1) OJ C 273, 6.11.2004.

Judgment of the Court (Grand Chamber) of 28 November
2006 — European Parliament v Commission of the Euro-
pean Communities

(Case C-413/04) (1)

(Directive 2003/54/EC — Common rules for the internal
market in electricity — Directive 2004/85/EC — Temporary
derogations in favour of Estonia — Legal basis)

Operative part of the judgment

The Court:

1) Annuls Council Directive 2004/85/EC of 28 June 2004
amending Directive 2003/54/EC of the European Parliament and
of the Council as regards the application of certain provisions to
Estonia, in so far as it grants Estonia a derogation from the appli-
cation of Article 21(1)(b) and (c) of Directive 2003/54/EC of the
European Parliament and of
the Council of 26 June 2003
concerning common rules for the internal market in electricity and
repealing Directive 96/92/EC going beyond 31 December 2008
and imposes a corresponding obligation to ensure only a partial
opening of the market representing 35 % of consumption on 1
January 2009 and an obligation to communicate annually the
consumption thresholds extending eligibility to final customers;

2) Dismisses the remainder of the action;

3) Orders the Council of the European Union to pay the costs;

4) Orders the Republic of Poland, the Republic of Estonia and the
Commission of the European Communities to bear their own costs.

(1) OJ C 273, 6.11.2004.

(2006/C 331/06)

Language of the case: French

Judgment of the Court (Grand Chamber) of 28 November
2006 — European Parliament v Commission of the Euro-
pean Communities

Parties

Applicant: European Parliament (represented by A. Baas and U.
Rösslein, agents)

Defendant: Council of the European Union, (represented by A.
Lopes Sabino and M. Bishop)

Intervener in support of the applicant: Commission of the European
Communities (represented by: J. Sack and P. Van Nuffel, agents)

(Case C-414/04) (1)

(Regulation (EC) No 1228/2003 — Conditions for access to
the network for cross-border exchanges in electricity — Regu-
lation (EC) No 1223/2004 — Temporary derogations in
favour of Slovenia — Legal basis)

(2006/C 331/07)

Language of the case: French

Intervener in support of the defendant: Republic of Estonia, (repre-
sented by L. Uibo, agent), Republic of Poland, (represented by
M. Węglarz, T. Nowakowski and T. Krawczyk, agents)

Parties

Re:

Applicant: European Parliament, (represented by: A. Baas and U.
Rösslein, Agents)

Annulment of Council Directive 2004/85/EC of 28 June 2004
the European Parliament
amending Directive 2003/54/EC of

Defendant: Commission of the European Communities, (repre-
sented by J. Sack and P. Van Nuffel, Agents)

30.12.2006

EN

Official Journal of the European Union

C 331/5

Intervener in support of the applicant: Commission of the European
Communities (represented by: A. Lopes Sabino and M. Bishop,
Agents)

Interveners in support of the defendant: Republic of Estonia, (repre-
sented by L. Uibo, Agent) Republic of Poland, represented by M.
Węglarz, T. Nowakowski and T. Krawczyk, Agents

Parties to the main proceedings

Applicants: Test Claimants in the FII Group Litigation

Defendant: Commissioners of Inland Revenue

Re:

Re:

Annulment of Council Regulation (EC) No 1223/2004 of 28
June 2004 amending Regulation (EC) No 1228/2003 of the
European Parliament and of the Council as regards the date of
application of certain provisions to Slovenia (OJ 2004 L 233, p.
3) — Legal basis

Operative part of the judgment

The Court:

1) Annuls Council Regulation (EC) No 1223/2004 of 28 June
2004 amending Regulation (EC) No 1228/2003 of the European
Parliament and of the Council as regards the date of application of
certain provisions to Slovenia;

2) Maintains the effects of Regulation No 1223/2004 until

the
adoption, within a reasonable period, of a new regulation founded
on an appropriate legal basis, without however prolonging those
effects beyond 1 July 2007;

3) Orders the Council of the European Union to pay the costs;

4) Orders the Republic of Poland, the Republic of Estonia and the
Commission of the European Communities to bear their own costs.

(1) OJ C 273, 6.11.2004.

Judgment of the Court (Grand Chamber) of 12 December
2006 (reference for a preliminary ruling from the High
Court of Justice of England and Wales, Chancery Division,
United Kingdom) — Test Claimants in the FII Group Litiga-
tion v Commissioners of Inland Revenue

(Case C-446/04) (1)

(Freedom of establishment — Free movement of capital —
Directive 90/435/EEC — Corporation tax — Payment of divi-
dends — Prevention or mitigation of a series of charges to tax
— Exemption — Dividends received from companies resident
in another Member State or a non member country — Tax
credit — Advance corporation tax — Equal treatment —
Claim for repayment or claim for damages)

(2006/C 331/08)

Language of the case: English

Referring court

High Court of Justice of England and Wales, Chancery Division

Reference for a preliminary ruling — High Court of Justice of
England and Wales, Chancery Division — Interpretation of Arti-
cles 43 and 56 EC and Articles 4(1) and 6 of Council Directive
90/435/EEC of 23 July 1990 on the common system of taxa-
tion applicable in the case of parent companies and subsidiaries
of different Member States (OJ 1990 L 225, p. 6) — Tax exemp-
tion granted in a Member State to a company established in its
territory which received dividends paid by companies also estab-
lished in its territory — Exemption not granted for dividends
paid to that company by companies established in the territory
of another Member State

Operative part of the judgment

1) Articles 43 EC and 56 EC must be interpreted as meaning that,
where a Member State has a system for preventing or mitigating
the imposition of a series of charges to tax or economic double
taxation as regards dividends paid to residents by resident compa-
nies,
treat dividends paid to residents by non-resident
companies in the same way.

it must

Articles 43 EC and 56 EC do not preclude legislation of a
Member State which exempts from corporation tax dividends which
a resident company receives from another resident company, when
that State imposes corporation tax on dividends which a resident
company receives from a non resident company in which the resi-
dent company holds at least 10 % of the voting rights, while at
the same time granting a tax credit in the latter case for the tax
actually paid by the company making the distribution in the
Member State in which it is resident, provided that the rate of tax
applied to foreign-sourced dividends is no higher than the rate of
tax applied to nationally-sourced dividends and that the tax credit
is at least equal to the amount paid in the Member State of the
company making the distribution, up to the limit of the amount of
the tax charged in the Member State of the company receiving the
distribution.

Article 56 EC precludes legislation of a Member State which
exempts from corporation tax dividends which a resident company
receives from another resident company, where that State levies
corporation tax on dividends which a resident company receives
from a non-resident company in which it holds less than 10 % of
the voting rights, without granting the company receiving the divi-
dends a tax credit for the tax actually paid by the company making
the distribution in the State in which the latter is resident.

2) Articles 43 EC and 56 EC preclude legislation of a Member State
which allows a resident company receiving dividends from another
resident company to deduct from the amount which the former
company is liable to pay by way of advance corporation tax the
amount of that tax paid by the latter company, whereas no such
deduction is permitted in the case of a resident company receiving
dividends from a non resident company as regards the corre-
sponding tax on distributed profits paid by the latter company in
the State in which it is resident.