Case C-608/17: Judgment of the Court (First Chamber) of 19 June 2019 (request for a preliminary ruling from the Högsta förvaltningsdomstolen — Sweden) — Skatteverket v Holmen AB (Reference for a preliminary ruling — Corporation tax — Group of companies — Freedom of establishment — Deduction of losses of a non-resident subsidiary — Concept of ‘final losses’ — Application to a sub-subsidiary — Legislation of the State of establishment of the parent company requiring direct ownership of the subsidiary — Legislation of the State of establishment of the subsidiary restricting the set-off of losses and prohibiting them from being set off in the year of liquidation)
Date: 2019-06-19
Institutions: Court of Justice
Subjects: corporation tax, group of companies, loss, nationality of legal persons, ownership, parent company, right of establishment, subsidiary, tax relief








C_2019270EN.01000601.xml










12.8.2019   


EN


Official Journal of the European Union


C 270/6






Judgment of the Court (First Chamber) of 19 June 2019 (request for a preliminary ruling from the Högsta förvaltningsdomstolen — Sweden) — Skatteverket v Holmen AB
(Case C-608/17) (1)

(Reference for a preliminary ruling - Corporation tax - Group of companies - Freedom of establishment - Deduction of losses of a non-resident subsidiary - Concept of ‘final losses’ - Application to a sub-subsidiary - Legislation of the State of establishment of the parent company requiring direct ownership of the subsidiary - Legislation of the State of establishment of the subsidiary restricting the set-off of losses and prohibiting them from being set off in the year of liquidation)
(2019/C 270/06)
Language of the case: Swedish

Referring court

Högsta förvaltningsdomstolen

Parties to the main proceedings


Applicant: Skatteverket

Defendant: Holmen AB

Operative part of the judgment







1.


The concept of final losses of a non-resident subsidiary, within the meaning of paragraph 55 of the judgment of 13 December 2005, Marks & Spencer (C-446/03, EU:C:2005:763), does not apply to a sub-subsidiary unless all the intermediate companies between the parent company applying for group relief and the sub-subsidiary sustaining losses that could be regarded as final are established in the same Member State;










2.


For the purposes of the assessment of the finality of a non-resident subsidiary’s losses, within the meaning of paragraph 55 of the judgment of 13 December 2005, Marks & Spencer (C-446/03, EU:C:2005:763), the fact that the subsidiary’s Member State of establishment does not allow the losses of one company to be transferred to another company in the year of liquidation is not decisive, unless the parent company demonstrates that it is impossible for it to deduct those losses by ensuring, in particular by means of a sale, that they are taken into account by a third party for future periods;










3.


If the fact referred to in paragraph 2 of the operative part of the present judgment becomes relevant, the extent to which the legislation of the State of establishment of the subsidiary sustaining the losses that could be regarded as final results in it not being possible to set off part of them against the current profits of the loss-making subsidiary or against those profits of another company in the same group is irrelevant.






(1)  OJ C 5, 8.1.2018.