Case T-664/25: Action brought on 25 September 2025 – LS and Others v ECB
Date: 2025-09-25
Institutions: General Court
Subjects: European official, basis of tax assessment, equal treatment, interest, remuneration of work, severance pay, tax on employment income








C_202506304EN.000101.fmx.xml












Official Journal of the European Union


EN
C series













C/2025/6304


1.12.2025






Action brought on 25 September 2025 – LS and Others v ECB


(Case T-664/25)

(C/2025/6304)
Language of the case: English

Parties


Applicants: LS and 21 other applicants (represented by: S. Orlandi, lawyer)

Defendant: European Central Bank

Form of order sought

The applicants claim that the Court should:






—


annul the decision of the ECB Executive Board of 18 March 2025 concerning ‘ex gratia payments’ for miscalculated taxation of termination payments, and the Executive Board decision of 15 July 2025 rejecting the applicants’ special appeals;










—


order the ECB to correct the taxation of termination of service payments (including compensation for unused annual leave, pension lump-sum withdrawals and Career Transition Support payments) for all affected staff, without limitation to the 1 November 2021 cut-off date;










—


order the ECB to pay compensatory interest on undue withholdings; and,










—


order the ECB to bear the costs.





Pleas in law and main arguments

In support of the action, the applicants rely on five pleas in law.






1.


First plea in law, alleging breach of Regulation No 260/68 (1) (Articles 6(1)(b) and 10) and misuse of procedure.










—


The ECB misapplied Article 6(1)(b) by using the ‘taxable amount’ instead of the ‘basic taxable amount,’ resulting in systematic over-taxation of termination payments (pension lump sums, CTS, compensation for unused annual leave). It also failed to ensure uniform application across institutions as required by Article 10. By labelling rectifications as ‘ex gratia,’ the ECB sought to avoid the full legal consequences of unlawful calculations, amounting to misuse of procedure.










2.


Second plea in law, alleging breach of the fundamental right to equal treatment (Article 20 of the Charter of Fundamental Rights of the European Union).










—


The Executive Board limited corrective payments to staff whose termination payments occurred on or after 1 November 2021. This arbitrarily excludes former staff in the same situation who were identically over-taxed. The payment date merely reflects execution of prior decisions and is not a valid legal distinction.










3.


Third plea in law, alleging violation of the right to good administration (Article 41 of the Charter).










—


The ECB provided no valid justification for the cut-off date. The sole explanation - when the ECB allegedly ‘became aware’ of misalignment - is internally focused and irrelevant. The approach undermines transparency, consistency, and fairness, and denies effective remedies.










4.


Fourth plea in law, alleging an obligation to pay compensatory interest.










—


Unlawful withholdings must be repaid with interest running from the date of undue payment until restitution. The ECB’s refusal to pay interest contradicts EU law principles of full reparation and its own 2019 precedent (main refinancing rate + 3.5 percentage points).










5.


Fifth plea in law, alleging a new and substantial fact justifying reopening of closed payslips.










—


The ECB’s March 2025 admission of systemic miscalculation constitutes a new and substantial fact warranting reopening earlier termination of service payslips and extending rectification beyond the arbitrary cut-off. Corrective payments are rectifications of unlawful decisions, not discretionary gestures.






(1)  Regulation (EEC, Euratom, ECSC) No 260/68 of the Council of 29 February 1968 laying down the conditions and procedure for applying the tax for the benefit of the European Communities (OJ 1968 L 56, p. 8).


ELI: http://data.europa.eu/eli/C/2025/6304/oj
ISSN 1977-091X (electronic edition)